Non-resident Indians (NRIs) parked over $1 billion in various bank deposit schemes in India in April, as against a $150 million outflow in the same year-ago period, showing a trend reversal in expat remittances to their home country.
The $1.08 billion inflow in April pushed up total NRI deposits in India to $153 billion as of end April, according to data released by India’s central bank.
Expat Indians remit foreign currency for bank deposits under either Foreign Currency Non-Resident (Banks) or FCNR(B) accounts, and Non-Resident External Rupee Account or NRE(RA) accounts.
In case of FCNR(B) deposits, the foreign exchange risk is borne by the deposit accepting bank, while in the NRE(RA) account, the currency risk is borne by the depositor.
The former is attractive when the rupee is depreciating against the dollar, while the latter is attractive when the rupee is appreciating.
The NRE(RA) deposits saw the highest inflow of $583 million in April, followed by $483 million in the FCNR(B) scheme, The Economic Times reported, citing the RBI data.
Analysts said a considerable momentum was visible in NRI bank deposits in India during FY24, particularly since May 2023.
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