HDFC Bank raises up to $300 million in NRE deposits
HDFC Bank, India’s most valuable lender, is said to have raised up to $300 million in NRE deposits, offering up to 50 basis points more than the prevailing rates, people familiar with the matter told ET. These deposits were garnered over two days last week. A basis point is 0.01%.
The Middle East led the list of new NRI depositors, while the rest of Asia and Europe didn’t do too badly either.
The relative success of this round of deposit garnering could prompt
“The window was kept open as an experiment, and it coincided with the US Federal Reserve policy announcement,” said one of the persons cited above.
On July 6, the Reserve Bank of India (RBI) permitted banks to garner FCNR (B) and NRE deposits from the Indian diaspora without any interest rate cap. Such relaxations are available until October 31 and November 4, respectively. The central bank also relaxed rules for external commercial borrowings, seeking to arrest the outflow of funds and ..
NRE and FCNR (B) Deposits
For NRE deposits, currency conversion risks at maturity, however, must be borne by depositors. The deposit plan proposed to pay 6.8% annually. For 12-15-month maturities, HDFC Bank offered 5.75-6.25% to domestic savers for deposit amounts between Rs 2 crore and less than Rs 5 crore at the time of international offering.
NRE and FCNR (B) deposits differ on the approved currency denomination for the respective instruments, with the dollar bei ..
Overseas depositors cannot opt for premature withdrawal.
The window remained open on July 27 and 28 for NRE fixed deposits.
The objective is to ensure inbound flows of dollars amid a rush for safe-haven assets worldwide.
Indians living abroad are likely to keep deposits in rupees as doing so takes care of family needs in the country.
According to RBI governor Shaktikanta Das, response to such measures can be evaluated after two months at least.
A large public sector bank based out of Mumbai reported about a 12% rise in NRE and FCNR (B) deposit collections since RBI’s announcements.
Congratulations to the whole team of HDFC Bank. Sending my best wishes for your business. I hope this gets you and your team a lot of success and fortune.Shishir Gupta, Founder and CEO, StartupLanes
Don’t keep wondering about funding, you can also raise funds. Learn how to raise funds here: Yes I want to raise funds.
If you are an emerging startup and are looking for investors to raise funds, StartupLanes has its own angel network and investment banking services and is connected to angel investors and VCs in 15 countries that ensure that our member startups have easy access to external funds to scale up constantly.
You can subscribe to our news posts by entering your email in the box on the right side of this page.
Check out our YouTube channel for insightful content from the Indian startup ecosystem.
Or join our Whatsapp group to interact with other founders: Yes, I want to join the Whatsapp group.
The right investment is key to beating inflation and growing your wealth. Do you wish to become an angel investor? Yes, I want to be an angel investor.
Are you a startup and facing challenges in your business? Do you want to grow your business? It is not as difficult as it sounds. Learn how to grow your business here- Yes, I want to grow my business.