Sending money to India from the United States or Canada? Your transfer could do more than cover everyday expenses. It could also help grow your savings.
The Reserve Bank of India (RBI) has introduced a temporary relaxation that allows eligible banks to offer higher interest rates on Foreign Currency Non-Resident (FCNR) deposits for a short period, from June 17, 2026, through September 30, 2026 (subject to bank participation and eligibility).
If you’re sending money home to build something bigger, i.e., support family, grow savings, or plan ahead, this could be a chance to make every dollar go further.
What is an FCNR Account & Why Does it Matter in 2026?
An FCNR (Foreign Currency Non-Resident) account is a type of fixed deposit designed for Non-Resident Indians (NRIs) to save money in foreign currencies while earning interest in India. Unlike regular deposits, FCNR accounts allow you to hold your funds in currencies such as USD, CAD, GBP, and AUD without converting them into Indian rupees.
It lets you hold your money in foreign currencies, such as:
- US dollar (USD)
- Canadian dollar (CAD)
- British pound (GBP)
- Australian dollar (AUD)
With an FCNR deposit, you can:
- Earn interest on your savings
- Keep your money in foreign currency
- Avoid exchange rate changes during the deposit period
- Move money between your overseas account and India more easily
In simple terms, if you send USD from the US, your deposit can stay in USD while earning interest in India.
For example, if you are an NRI living in Canada and deposit Canadian dollars (CAD) into an FCNR account, your money remains in CAD instead of being converted into Indian rupees. Before transferring funds, you can check the CAD to INR exchange rate to understand how currency values may impact your transfer. The same principle applies whether you’re sending USD from the USA or AUD from Australia: your deposit stays in the currency you send, while earning interest in India.
Here’s why it stands out:
- Higher interest rates: Many banks are offering better-than-usual rates during this period, depending on the currency and duration.
- Tax-free interest in India: The interest you earn is not taxed in India, similar to NRE (Non-Resident External) account.
- Protection from currency changes: Because your money stays in foreign currency, you’re not exposed to exchange rate ups and downs during the deposit period.
What is an NRE Deposit Account and How Does It Work?
An NRE (Non-Resident External) account is a savings account designed for Non-Resident Indians (NRIs) to manage their foreign income in India. It allows you to deposit funds earned outside India and hold them in Indian rupees (INR) while earning interest on your savings.
Unlike an FCNR account, where your money stays in a foreign currency, an NRE account converts your foreign currency into INR when you deposit funds. This makes it a convenient option for NRIs who want to manage expenses, investments, or support family members in India.
With an NRE account, you can:
- Deposit foreign earnings into an Indian bank account
- Manage expenses and investments in India
- Earn interest on your INR savings
- Transfer funds back overseas when needed (subject to applicable regulations)
For example:
If you’re an NRI living in Canada, the US, or Australia and transfer CAD, USD, or AUD to your NRE account, the funds are converted into Indian rupees (INR) at the prevailing exchange rate and can be used for expenses, investments, or family support in India.
NRE vs. NRO vs. FCNR: Structuring Your Wealth Perfectly
Before you chase the highest rate, make sure your money is sitting in the right account. Indian banks offer NRIs three main account types, and each one exists for a different source of funds:
Choosing the right NRI account depends on where your money comes from and how you want to manage it. Here is how NRE, NRO, and FCNR accounts differ:
| Feature | NRE Account | NRO Account | FCNR Account |
| Best for | Foreign earnings you want to save or invest in India | Income earned in India (rent, dividends, pension) | Large foreign-currency sums you don’t want to convert to INR yet |
| Currency held | Indian Rupees (INR) | Indian Rupees (INR) | Foreign currency (USD, CAD, GBP, EUR, AUD, etc.) |
| Tax on interest (India) | Tax-free | Taxable, ~30% TDS plus surcharge and cess | Tax-free |
| Repatriation | Fully repatriable, no limit | Capped at USD 1 million per financial year, with Form 15CA/15CB | Fully repatriable, no limit |
| Currency risk | Exposed to INR movements | Exposed to INR movements | Lower currency risk when compared with INR-based deposits, as deposit and payout remain in the same currency |
A few NRE account advantages worth highlighting no matter where you’re sending from — Canada, the US, or Australia: unlimited repatriation, no Indian tax on interest, and the flexibility to fund it directly from a bank transfer in your local currency. Many NRIs run all three accounts side by side – NRE for regular savings, NRO for India-sourced income, and FCNR for a lump sum they want to protect from currency swings while the current rate window lasts.
Flexible Ways to Fund Your Deposit
Once you decide to open an FCNR deposit, you have multiple ways to transfer funds into your account. NRIs can choose the option that best fits their banking setup and where their money is currently held.
Transfer Funds from Your NRE Account
If you already have an NRE account in India, you can transfer eligible funds from your NRE account to your FCNR deposit. This can be a convenient option for NRIs who already manage their savings through an Indian bank account.
Send Money Directly from Abroad
NRIs can also fund their FCNR deposit by sending money directly from abroad using online transfer options in supported foreign currencies, such as:
- Canadian dollars (CAD)
- US dollars (USD)
- British pounds (GBP)
- Australian dollars (AUD)
For example, an NRI living in Canada can send CAD to India and use those funds to open an eligible FCNR deposit without converting the money into INR.
Start Your Money Transfer to India
FCNR and NRE accounts work the same way no matter where you’re sending from – what differs is how you get your money to India. Here’s the fastest way to start your transfer from each major sending corridor.
Sending USD, CAD or AUD to India? Start your transfer and check today’s exchange rate before funding your NRE or FCNR deposit.
Send Money to India from Canada →
Send Money to India from United States →
Send Money to India from Australia →
What Interest Rates You Can Expect on an FCNR Deposit?
FCNR interest rates vary depending on several factors, including the bank, currency, and deposit tenure. Since FCNR deposits are maintained in foreign currencies, the interest rate may differ from regular Indian rupee deposits.
Interest rates can vary depending on:
- The bank you choose: Different banks offer different rates based on their deposit policies.
- The currency of your deposit: Rates can vary for currencies such as CAD, USD, GBP, and AUD.
- The deposit tenure: Longer deposit periods may offer different interest rates compared to shorter terms.
- The amount deposited: Some banks may have different rates based on deposit size.
Typical FCNR Interest Rate Range
In many cases:
- Rates may range from around 3% to over 7%
- Longer deposit periods (such as 3 to 5 years) may offer better returns
Since rates differ across banks, it’s worth comparing your options before you decide.
Banks offering FCNR deposits in India
Several Indian banks offer FCNR (Foreign Currency Non-Resident) deposits for eligible NRIs, allowing them to save in supported foreign currencies while earning interest.
- State Bank of India
- HDFC Bank
- ICICI Bank
- Axis Bank
- Central Bank of India
- AU Small Finance Bank
- Karur Vysya Bank
FCNR deposit rates, supported currencies, and minimum deposit requirements can vary by bank. Always check the latest terms and eligibility criteria with your preferred bank before opening an account.
Who Is an FCNR Account Best For?
An FCNR account can be a suitable option for NRIs who want to save their foreign earnings in India while keeping their money in a foreign currency. Whether you’re helping your family back home, setting aside savings for the future, or planning your next move, how you send money can make a difference.
- You live in the US or Canada and want to send money to India
NRIs can use foreign currency savings to fund an FCNR deposit and continue earning interest without immediately converting funds into INR. - You’re planning to send a larger amount home
FCNR deposits can be useful for managing larger savings while keeping funds protected from currency fluctuations during the deposit period. - You want to earn interest without converting your money into INR
Since FCNR deposits are held in foreign currencies like CAD, USD, GBP, or AUD, your savings remain in the selected currency. - You prefer a stable and predictable return
Fixed interest rates and chosen deposit tenures can help you plan your savings goals more easily.
How to get Started with an FCNR Account?
If you are planning to open an FCNR deposit, the first step is to transfer your funds to India. Once your money reaches your Indian bank account, you can work with your chosen bank to place eligible funds into an FCNR deposit.
Step 1: Confirm your FCNR deposit requirements
Before sending money, check with your bank about:
- Available FCNR currencies such as CAD, USD, GBP, and AUD
- Minimum deposit requirements
- Deposit tenure options
- Required documentation for NRIs
Step 2: Send money to India with Western Union
Western Union helps NRIs transfer funds from abroad conveniently, whether you are sending money from Canada, the US, or another supported location.
You can:
- Send money to India from your bank account
- Transfer funds directly to an eligible bank account in India
- Start your transfer online or through the Western Union mobile app
- Track your transfer status throughout the process
Step 3: Open your FCNR deposit with your bank
Once your funds arrive in India, contact your bank to place the eligible amount into an FCNR deposit based on your preferred currency and deposit tenure.
By simplifying the transfer process, Western Union helps you move your funds from abroad to India, making it easier to take the next step toward your FCNR deposit within the available timeframe.
Important Things To Keep in Mind
Before you decide, consider these factors:
- This is a limited-time opportunity, ending around September 30, 2026
- Interest rates can change during this period
- Minimum deposit amounts and terms vary by bank
- Available currencies may differ
- Always confirm the latest details directly with your bank.
If you’re already planning to send money to India, this could be a good time to make that transfer. With higher interest rates, tax-free earnings in India, and the ability to keep your money in foreign currency, FCNR deposits offer a simple way to get more value from your savings.
Turn today’s transfer to India into something more.
Start your transfer with Western Union and explore FCNR deposit options with your and your recipient’s bank.
Disclaimer: This article is provided for general informational purposes only and does not constitute financial, investment, tax, or legal advice. Western Union provides money transfer services and does not provide advice on banking products, investments, or taxes. Interest rates, tax treatment, eligibility requirements, and RBI regulations may change and vary by bank and individual circumstances. Please consult your bank or a qualified financial or tax advisor before making financial decisions.
NRE and FCNR Account FAQs: Everything NRIs Need to Know
An NRE account (non resident external account) holds foreign income, is tax-free in India, and is fully repatriable. An NRO account holds India-sourced income, is taxed at close to 30%, and caps repatriation at USD 1 million per financial year.
An FCNR account is a fixed deposit that keeps your money in a foreign currency – such as USD or CAD – instead of converting it to rupees, so you earn tax-free interest without taking on currency risk.
FCNR and NRE rates vary by bank, currency, and tenure. Check current rates directly with your bank before opening a deposit.
The RBI’s relaxation on FCNR(B) deposits (3-to-5-year tenors) and NRE deposits (3 years and above) runs from June 17, 2026 to September 30, 2026. Deposits booked within this period typically lock in their rate for the full tenor, but confirm exact terms with your bank.
FCNR deposits are available in major foreign currencies, including USD, GBP, EUR, AUD, CAD, JPY, and SGD, although the exact options vary by bank. Many Indian banks also allow Australia-based NRIs to open FCNR deposits directly in Australian dollars (AUD), helping avoid unnecessary currency conversions.
You can transfer funds into an NRE account by sending money from your overseas bank account through an international bank transfer or a trusted money transfer provider such as Western Union. Once the funds reach your NRE account, they are automatically converted into Indian rupees (INR). Always use your bank’s official channels or a verified provider for secure transfers.
An FCNR account lets NRIs hold fixed deposits in foreign currency, protecting savings from exchange rate fluctuations. The interest earned is tax-free in India, and both the principal and interest are fully repatriable. It is a suitable option for NRIs who want to preserve their foreign currency savings while earning competitive returns.
Yes. At maturity, you can convert your FCNR deposit into Indian rupees or transfer the funds to another eligible account. If you convert the deposit before maturity, banks may charge an early withdrawal penalty or reduce the applicable interest, depending on their terms. Any currency conversion will be carried out at the prevailing exchange rate.
