%20(500%20%C3%97%20280%20px)%20(500%20x%20300%20px)%20(86).png "Interest rate ceilings on FCNR (B) deposits have been increased by RBI")
- This move is aimed at attracting more foreign currency deposits into Indian banks.
- Here's how it works:
- New Interest Rate Ceilings:
- For deposits of 1-3 years, the new ceiling is the Overnight Alternative Reference Rate (ARR) plus 400 basis points.
- For deposits of 3-5 years, it is ARR plus 500 basis points.
- Effective Period: These revised interest rate ceilings are effective until March 31, 2025.
- Purpose: The increase in ceilings aims to encourage more NRIs to deposit their foreign currency earnings in Indian banks, thus boosting the country's foreign exchange reserves.
Question:
1 What is the new interest rate ceiling for Foreign Currency Non-Resident (Banks) [FCNR (B)] deposits of 1-3 years, as announced by the RBI on December 6, 2024?
- A) ARR + 300 basis points
- B) ARR + 400 basis points
- C) ARR + 500 basis points
- D) ARR + 600 basis points
