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For Non-Resident Indians (NRIs), managing income earned in India—such as rent, dividends, or pension—is a critical part of financial planning. In 2025, NRO Deposits continue to be a reliable and convenient option for NRIs looking to park these funds securely while earning interest. But is it a smart investment in today’s financial landscape? Let’s explore.
What Are NRO Deposits?
NRO Deposits, or Non-Resident Ordinary deposits, allow NRIs to deposit and manage their income earned within India. These deposits are maintained in Indian rupees and come in two common forms—NRO savings account and fixed deposits. While the savings account offers liquidity and flexibility, fixed deposits provide higher returns over a fixed tenure.
Stable and Safe Investment
In an era of global financial uncertainty, NRO Deposits offer a relatively stable and low-risk investment avenue. Being held in Indian banks and regulated by the Reserve Bank of India (RBI), these accounts provide the security many NRIs seek. With most banks offering attractive interest rates between 4% and 7% on fixed NRO deposits in 2025, this instrument remains competitive when compared to international low-yield savings options.
Taxation: Something to Consider
Interest earned on NRO savings accounts and deposits is subject to Indian taxation, typically with a Tax Deducted at Source (TDS) of 30%. However, this can often be reduced under Double Taxation Avoidance Agreements (DTAA) if applicable. Despite the tax factor, many NRIs still choose NRO deposits for the convenience and local access they offer.
Liquidity and Accessibility
Another advantage is that NRO Deposits offer decent liquidity. Most banks allow partial withdrawals in emergencies, especially from NRO savings accounts, and premature closure of fixed deposits is often permitted with minimal penalty.
Who Should Consider NRO Deposits in 2025?
If you earn income in India and want to manage it without currency conversion risks, NRO Deposits are a strong choice. They are particularly suitable for NRIs looking to:
Pay for family expenses in India
Invest in local assets
Maintain a financial presence in the country
The SBM Bank India Advantage
For NRIs exploring NRO banking solutions in 2025, SBM Bank India offers competitive interest rates, flexible tenures, seamless account setup, and dedicated customer support tailored for global Indians. Whether you're opening an NRO savings account or opting for a fixed deposit, SBM Bank India ensures a secure and rewarding banking experience.
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