What is the minimum tenure for an FCNR account?

The minimum tenure is one year.

Can I prematurely withdraw my FCNR deposit?

Yes, but premature withdrawals before one year earn no interest and withdrawals after one year may incur penalties.

Are the funds in an FCNR account taxable?

No, both the principal and interest earned are tax-free in India.

What happens to the FCNR account upon maturity?

You can choose to renew the account or repatriate the funds. If inactive for three years post-maturity, the balance is converted into INR.

Can I open an FCNR account jointly?

Yes, joint accounts are allowed, but all account holders must be NRIs.

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Disclaimer: # The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 1 Cr. is for a 30 year old healthy individual investing Rs 10,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: ₹1,05,02,174 @ CAGR 8%; ₹50,45,591 @ CAGR 4%. All plans listed here are of insurance companies’ funds.

Union Bank of India FCNR Account

For Non-Resident Indians (NRIs), managing finances across borders can be a complex task. The Union Bank of India FCNR (Foreign Currency Non-Resident) account offers a convenient solution by allowing you to hold deposits in foreign currency, eliminating exchange rate risks and providing competitive returns. Whether you aim to save or invest, this account ensures your money works effectively while staying secure.

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What is an FCNR Account?

An FCNR (Foreign Currency Non-Resident) account is a type of fixed deposit account that allows NRIs to deposit their money in foreign currency. One of its primary advantages is that it eliminates the need to convert foreign earnings into Indian Rupees (INR), thereby mitigating exchange rate risks. This makes it a practical and attractive option for many NRIs.

Features of Union Bank FCNR Account

Currency Options: Union Bank offers FCNR accounts in various foreign currencies, including USD, GBP, EUR, CAD, and AUD.
Tenure: Choose a flexible deposit period ranging from 1 to 5 years, catering to your financial goals.
Repatriable: Both the principal and interest are fully repatriable, allowing you to transfer funds back to your foreign account without any restrictions.
Competitive Interest Rates: Union Bank offers attractive interest rates to maximize your returns.

Advantages of Union Bank FCNR Account

Avoid Exchange Risk: Keep your savings in the currency you earn, shielding yourself from exchange rate fluctuations.
Higher Returns: FCNR accounts often offer better interest rates compared to NRE and NRO accounts.
Trustworthy Institution: Union Bank of India’s robust reputation ensures your investments are secure.

How to Open an FCNR Account in Union Bank?

Documentation Requirements:
- Proof of Identity: Passport, driver’s license, or other government-issued ID.
- Proof of Overseas Residence: Utility bill, rent agreement, or overseas bank statement.
- Initial Deposit: Minimum deposit varies by currency.
Steps to Open an Account:
- Visit the Bank or Website: Start the process at a Union Bank branch or via their official website.
- Fill the Application: Complete the FCNR account application form.
- Submit Documents: Provide your ID and proof of residence.
- Make the Initial Deposit: Deposit funds in your chosen foreign currency.
- Account Activation: The account is typically activated within a few business days after verification.
Tips for a Smooth Process:
- Verify the list of required documents specific to your resident country.
- Read all terms and conditions carefully, especially concerning withdrawal penalties and deposit limits.

Terms and Conditions for FCNR Account in Union Bank

Interest Rate Changes: Rates are subject to change, and the applicable rate will be the one prevailing on the deposit’s processing date.
Minimum Deposit Requirements: The minimum deposit varies depending on the selected currency. Check these details before opening an account.
Bulk Deposits: Deposits equivalent to or exceeding INR 2 Crore in USD, GBP, EUR, CAD, or AUD are considered bulk deposits. Contact Union Bank for specific rates.
Inactivity and Conversion: If the account remains inactive for three years post-maturity, the balance will be converted into INR at the prevailing exchange rate.
Premature Withdrawal:
- No interest is paid if withdrawn before one year.
- For deposits opened before October 1, 2021, a 1% penalty applies after one year.
- For deposits opened after October 1, 2021, the penalty is reduced to 0.5%.

Pros and Cons of Union Bank FCNR Accounts

Pros:

Currency Diversification: Hold deposits in multiple foreign currencies, reducing currency fluctuation risks.
Competitive Rates: Benefit from attractive interest rates, especially for USD and GBP.
Repatriability: Enjoy full repatriation of principal and interest.

Cons:

Minimum Deposit Requirement: Initial deposit requirements may be high for some.
Premature Withdrawal Penalty: Early withdrawals may incur penalties.

FAQs

What is the minimum tenure for an FCNR account?

The minimum tenure is one year.
Can I prematurely withdraw my FCNR deposit?

Yes, but premature withdrawals before one year earn no interest and withdrawals after one year may incur penalties.
Are the funds in an FCNR account taxable?

No, both the principal and interest earned are tax-free in India.
What happens to the FCNR account upon maturity?

You can choose to renew the account or repatriate the funds. If inactive for three years post-maturity, the balance is converted into INR.
Can I open an FCNR account jointly?

Yes, joint accounts are allowed, but all account holders must be NRIs.

†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
*Past 10 Year annualised returns as on 01-01-2025
*All savings plans are provided by the insurer as per the IRDAI approved insurance plan. Tax benefit is subject to changes in tax laws. Standard T&C Apply
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
#The investment risk in the portfolio is borne by the policyholder. Life insurance is available in this product. The maturity amount of Rs 2 Cr. is for a 30 year old healthy individual investing Rs 18,000/- per month for 30 years, with assumed rates of returns @ 8% p.a. that is not guaranteed and is not the upper or lower limits as the value of your policy depends on a number of factors including future investment performance. In Unit Linked Insurance Plans, the investment risk in the investment portfolio is borne by the policyholder and the returns are not guaranteed. Maturity Value: 1,06,79,507 @ CAGR 4%; 2,12,15,817 @ CAGR 8%. All plans listed here are of insurance companies’ funds. *Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
**Returns are based on past 10 years' fund performance data (Fund Data Source: Value Research).