INTRODUCTION -

• Reserve Bank of India (RBI) on 17^th July issued draft guideline for two new categories of bank 

⇒ Small & Payment Banks .

• Payment banks and Small Banks are expected to meet credit and remittance needs of small business , unorganised sector , low income households , farmers and migrants work force .
• The new banks which are expected to reach customers mainly through their mobile phones rather than traditional bank branches. One could make payments to the milk men and domestic help through his mobile rather than going to the bank, withdrawing cash and then handing it over to them.
• In less than 10 years, every Indian will have a bank account. Payment banks are the key enablers.

CAPITAL REQUIREMENT –

• The minimum paid up voting equity capital for small banks shall be Rs. 100 Crore .
• Any additional voting equity capital to be brought in will depend on the business plan of the promoters .
• In view of the inherent risk of a small bank , it shall be required to maintain a minimum capital adequacy ratio of 15% of its risk weighted assets (RWA) on a continuous basis .
• The payments bank should have a leverage ratio of not less than 3 per cent, i.e., its outside liabilities should not exceed 33.33 times its net worth (paid-up capital and reserves).

ELIGIBLE PROMOTER'S -

• Resident individuals/professionals with so years of experience in banking and finance,
• Companies and Societies
• Existing Non-Banking Finance Companies (NBFCs),
• Micro Finance Institutions (MFIs),
• Preference will be given to professionals from banking/ financial sector, NBFCs and MFIs to set up small banks, if they meet the "fit and proper" criteria.

PROMOTER’S CONTRIBUTION –

• The promoter’s minimum initial contribution to the paid up voting equity capital of such small bank shall at least 40% which shall be locked in for a period of five years from the date of commencement of business of bank .
• Shareholding by promoters in the bank in excess of 40% shall be brought down to 40% within three years from the date of commencement of business of the bank .

PROCEDURE FOR APPLICATION -

• In terms of Rule n of the Banking Regulation (Companies) Rules, 1949 applications shall be submitted in the prescribed form (Form III).
• In addition,(Business plan, shareholding pattern in the proposed bank, financial statements, income tax returns and credit reports for last three years, names and addresses of banks from which credit facilities are availed, etc.)

PROCEDURE FOR RBI DECISION -

• The applications will be initially screened by RBI to ensure prima facie eligibility of the applicants.
• Thereafter an External Advisory Committee (EAC) comprising eminent professionals like bankers, chartered accountants, finance professionals, etc. will evaluate the applications.
• The names of the professionals in EAC will be placed on RBI's website.

CORE OBJECTIVE OF PAYMENT BANK –

The study is conducted to reach the following objectives.

• To analyse the functions of payment banks.
• To study its effect on Indian economy.
• Small savings accounts
• Payments/remittance services to migrant labour workforce, low income households, small businesses, other unorganised sector entities and other users.

NEED OF PAYMENT BANK IN INDIA -

• The underlying objective is to use these new banks to push for greater financial inclusion. Currently, almost 50% of Indians don't have a bank account and only about 30,000 of India's 5.94 lakh villages have a commercial bank branch. Much of this imbalance has to do with the inability of bigger banks to reach into the hinterland.

FUNCTION OF PAYMENT BANKS -

• They can't offer loans but can raise deposits of uptoRs. 1 lakh, and pay interest on these balances just like a savings bank account does.
• They can enable transfers and remittances through a mobile phone.
• They can offer services such as automatic payments of bills, and purchases in cashless, cheque less transactions through a phone.
• They can issue debit cards and ATM cards usable on ATM networks of all banks.
• They can't offer loans but can raise deposits of uptoRs. 1 lakh, and pay interest on these balances just like a savings bank account does.
• They can enable transfers and remittances through a mobile phone.
• They can offer services such as automatic payments of bills, and purchases in cashless, cheque less transactions through a phone.
• They can issue debit cards and ATM cards usable on ATM networks of all banks.
• They can transfer money directly to bank accounts at nearly no cost being a part of the gateway that connects banks .
• They can provide forex cards to travellers , usable again as a debit Or ATM cards all over India
• They can offers forex services at charges lower than bank .
• They can also offer cards acceptance mechanism to third party such as “APPLE PAY”.

ELIGIBLE PROMOTERS -

• Existing non-bank Pre-paid Payment Instrument (PPI) issuers; and other entities such as individuals / professionals; Non-Banking Finance Companies (NBFCs), corporate Business Correspondents(BCs), mobile telephone companies, super-market chains, companies, real sector cooperatives; that are owned and controlled by residents; and public sector entities may apply to set up payments banks.
• A promoter/promoter group can have a joint venture with an existing scheduled commercial bank to set up a payment bank.

SELECTED PROMOTERS FOR PAYMENT BANKS –

Lastly Gov. of India approved 11 firms are given licence for openings of Payment Banks . The Promoters are as follows –

• Aditya Birla Nuvo Ltd.
• Airtel M Commerce Service Ltd.
• Cholamadalam Distribution Service Ltd.
• Department of Posts ( Indian Post )
• FinoPayTech Ltd.
• National Security Depository Ltd.
• Reliance Industries Ltd.
• DilipShantilal Ltd.
• Vijay ShekharSharms
• Tech Mahendra Ltd.
• Vodafone m-pesa Ltd.

SCOPE OF PAYMENT BANKS IN INDIA -

• Acceptance of demand deposits. Payments bank will initially be restricted to holding a maximum balance of Rs. ioo,000 per individual customer.
• Issuance of ATM/debit cards. Payments banks, however, cannot issue credit cards.
• Payments and remittance services through various channels.
• BC of another bank, subject to the Reserve Bank guidelines on BCs.
• Distribution of non-risk sharing simple financial products like mutual fund units and insurance products, etc.

OUR VIEW POINT -

• The public sector banks are just behaving sitting ducks and white elephants. They do not work efficiently. Recently government has pumped huge capital to certain public sector bank. Even though public sector, private sector or foreign bank do not have reach to rural so let change the traditional banking and foster a new concept of banking. This payment banks can largely help to jandhanyojona, in addition it will drag the weaker section vulenerable into the financial inclusion process. Those small saving upto lakh are created in this bank but in long run a huge capital may be formed. The hamlet dwellers without having investment knowledge can safely deposit their saving in payment bank not in chit fund or any other high risk investment area.

Introduction

India is advancing at breathtaking speed towards a cashless economy and to make digital mode of payment a habit for people our honourable Prime Minister Narendra Modi has launched a new application for mobile payment BHIM (Bharat Interface for Money) on the 30th of December.

What is BHIM?

Bhim is an application for payment through smartphones which is based on the technology of UPI (Unified Payment Interface). This app has been developed by the NPCI (National Payment Corporation of India) in association with Juspay. This app is now readily available on playstore which is the android platform the and same for the iOS platform is expected to be launched soon.

Features of BHIM

• It is based on UPI technology
• Enables digital transactions across multiple banks
• It links directly to one’s bank account
• It uses IMPS (Immediate Payment Service) for which one has to pay a minimal fee for transactions of 1 lakh or above.

How to use

• On downloading the app users will be asked to verify their mobile numbers which are linked with their respective bank account.
• After verification the app will show a list of all the bank accounts linked to the mobile number.
• One has to select the account he or she wants to make transactions through
• After selecting the account the user has to enter a 4 digit code (UPI PIN) to make transactions through the app
• The payment address will be set as the mobile number which is entered for verification which can be changed later.

Positive points of BHIM

• A smartphone or even a feature phone of around 1000 INR will support the BHIM app
• Having an internet connection is not mandatory for making transactions through the app
• In this system, once the bank account is linked with an Aadhar gateway, payments can be made through a thumb impression
• Users can also use the app for shopping. For this an Aadhar based merchant app has to be downloaded by the retailer along with a biometric reader to enable payment through thumb print.

Limitation

• For now maximum limit for every transaction has been set at 10,000 INR and a total transaction of 20,000 INR per day. The limits are expected to change in future.

Banks supporting BHIM

• The new BHIM Payment app is supported by banks like SBI, ICICI, Axis Bank, HDFC Bank and many others.
• The BHIM app is at its early stages and thus there might be some glitches but with time improvements are bound to take place taking the country forward to digitization and transforming India into Digital India.

Introduction:

Aadhaar Enabled Payment System is a major initiative taken by Government of India to initiate a simple, secure user friendly mode of payment solution by Micro-ATM. It also empower Cashless Economy in the country in future. The basic meaning of AEPS is a customer can pay through Aadhaar Card, i.e. Empowering Cashless transactions in the country. Through Aadhaar Card a customer can access his/her bank account. However, these days Government of India is also trying to empower bank customers to use Aadhaar as his/her main identity to access his/her respective Aadhaar enbled bank account and perform various transactions like balance enquiry, cash deposit, cash withdrawal, Pay through Aadhaar, etc.

Basic banking transactions through Aadhaar Card:

• Aadhaar to Aadhaar fund transfer
• Cash withdrawal
• Cash Deposit
• Balance Enquiry

During Any Basic Transactions a customer’s needs:

• IIN (Issuer Identification Number) – It is the Identification number to recognise the Bank to which the customer’s banks account is associated.
• Aadhaar Card Number – It is a 12 digit unique identification number provided by the Gov. of India at the time of enrolment.
• Finger Print – A customers need his/her finger print which was captured during their enrolment.

Major Role Played by NPCI in AEPS:

• NPCI (National Payment Corporation of India): It was founded in 2008, Headquarters at Mumbai, It is the umbrella organisation for all retail payment systems in India, which aims to allow all Indian citizens to have unrestricted access to e-payment services.
• NPCI conducts all government benefits/subsidies to beneficiary account in a secured and transparent manner.
• It also provides a unique platform to use safe and secure payment interface to avail those benefits by using their finger prints.
• NPCI is directly in touch with Unique Identification Authority of India to provide Aadhaar Enabled Payment Service to reduce the forgery in Indian Financial System. 

Basic Layout/ How it works:

Let us understand by using flow chart. I Hope it will clear everything. But here I will describe the following steps.

• Step 1 – Customer swaps his/her cards at Mini ATM.
• Step 2 – Mini ATM fetch data from Customers Bank
• Step 3 – Customers bank get confirmation from NPCI.
• Step 4 – NPCI get confirmations from UIDAI.
• Step 5 – UIDAI approve confirmed details about customer Account to NPCI.
• Step 6 – Again after getting confirmation from UIDAI , NPCI again asks Creditors details to his/her banks.
• Step 7- Creditors Bank Approve details of creditors to NPCI
• Step 8- NPCI now confirms to SBI 
• Step 9 – SBI deduct the amount which customers want to pay/credit.
• Step 10 – Now customers get confirmations bill from Mini ATM.

Benefits of AEPS:

• Aadhaar enabled Payment platform is a very important tools to rule out all the fake data in the system concerning National Social Assistance Programme (NSAP). 
• The basic theme of Direct Benefit Transfer is to ensure that the beneficiary gets their benefit through Aadhaar Enabled Payment System (AEPS) which is an accountable, cost-effective and transparent.

• Now, it is very difficult to carry plastic money and it involves many risks also and it is necessary to use the latest information communication and technology.
  
• Banks are providing better products and services like internet banking, mobile banking, ATM card, debit and credit card.
• Debit card and ATM card are used to withdraw money by using a PIN

ATM Card

• ATM card is a payment card which is issued by the bank that provides service to the client to access it and withdraw money when needed.
• ATM card is a plastic card issued made by the bank includes the essential information about the bank account of the account holder.
• ATM card is generally used to withdraw money anytime along with it one can also deposit money into their bank accounts using ATM cards
• ATM card facilitates the general purposes of withdrawals, balance inquiry by statement facility and by depositing money through it.
• It is secure because when the transaction happens in an account, banks will send an alert message. So, one can crosscheck the transaction.

Debit Card

• A debit card is also known as "check card".
• Debit card facilitates the card owner to make transactions electronically and transfer the fund from the account while making a purchase.
• A debit card is a plastic card which is issued by the bank to pay for the purchase of goods and services at any time.
• The facility is used by those who have a bank account.
• A debit card is used to make online payment through electronic fund transfer at point of sale.
• A debit card is also used to check account balance, transfer funds to the account to another account.
• A debit card is linked to the cell phone so that the client will get a notification on time.

Similarities of ATM Card and Debit Card

• ATM card and debit card are made of plastic and both have the same appearance.
• Both are issued by the bank and provide the facility like balance inquiry, withdrawal of money or make payment online and much more.
• Banks charge fees for providing this kind of facility and it varies from bank to bank.

Difference Between ATM and Debit Card

Basis	ATM card	Debit card
Meaning	ATM card is a payment card which is issued by the bank that provides service to the client to access it and withdraw money when needed.	A debit card is a plastic card which is issued by the bank to pay for the purchase of goods and services at any time.
Use	ATM card is less used as compared to the Debit card. ATM card is used for Balance statement, deposits, withdrawals, transfer of funds can be done.	A debit card has more usage than the ATM card. It is used for balance statement, deposits and online payment for any purchases.
Appearance	ATM card is a plastic card which has no logo of any particular ATM network provider.	A debit card is also a plastic card having features like the name of the bank, a name of payment processing networks like visa card or a master card.
Signature	In ATM card, there may or may not be a signature of the account holder.	On the back of any debit card, there must be a signature of an account holder.
Number on card	In ATM card, there is bank account number which is in any number of digits.	A debit card has a 16 digit account number which differs from the bank account number.
Range	ATM card used in national boundary.	A debit card can be used beyond the national boundary it means internationally at any time.

• First bank in India- Bank of Hindustan (1770) 
• First Bank managed by Indians- Oudh Commercial Bank 
• First Bank with Indian capital- Punjab National Bank (Founder of the Bank is Lala Lajpat Rai) 
• First Foreign Bank in India – HSBC 
• First bank to get ISO certificate – Canara Bank 
• First Indian bank outside India –Bank of India 
• First Bank to introduce ATM – HSBC (1987, Mumbai) 
• First Bank to have joint stock public bank (Oldest) – Allahabad Bank 
• First Universal bank – ICICI (Industrial Credit and Investment Corporation of India) 
• First bank to introduce saving account – Presidency Bank (1833) 
• First Bank to introduce Cheque system – Bengal Bank (1833) 
• First bank to give internet banking facility – ICICI 
• First bank to sell mutual funds – State Bank of India 
• First bank to issue credit cards - Central Bank of India 
• First Rural Regional Bank (Grameen Bank) – Prathama Bank (sponsored by Syndicate Bank) 
• First bank to get ‘in principle’ banking license – IDFC and Bandhan Bank 
• First Bank to introduce merchant banking in India – Grind lays bank 
• First bank to introduce block chain technology – ICICI 
• First bank to introduce voice biometric – Citi Bank 
• First bank to introduce robot in banking service- HDFC 

Miscellaneous points:

• Largest public sector bank in India – State Bank of India 
• Largest private sector bank in India – ICICI 
• Largest foreign bank in India – Standard Chartered Bank 
• Bank with more branches in India – State Bank of India 

Present 5 Associates of SBI : 

• Bank of Travancore 
• Bank of Patiala 
• Bank of Bikaner and Jaipur 
• Bank of Hyderabad 
• Bank of Mysuru

Saving Account Regular Savings Current Account Recurring Deposit Account Fixed Deposit Account DEMAT Account NRI Accounts

1. Saving Account 
2. Regular Savings
3. Current Account 
4. Recurring Deposit Account 
5. Fixed Deposit Account 
6. DEMAT Account
7. NRI Accounts

a) Basic Savings Bank Deposit Accounts (BSBDA) This account will be considered as normal banking service. For this account, maintenance of minimum balance is not required. ATM card/ ATM cum Debit card, Rupay card will be given for the account holders. There are going to be no limit on the number of deposits that can be made in a month but, account holders will be allowed most of 4 withdrawals in a month, which includes ATM withdrawals also. The above facilities will be given without any charge. There will be no charge levied for non-operation/ activation of in-operative basic saving bank deposit account. For this account, overdraft facility will be provided up to Rs. 5000/-. b) Basic Saving bank Deposit Accounts Small scheme (BSBDS) These are accounts with relaxed KYC, with a minimum document requirement of self-attested address proof & photograph. Total credit should not exceed 1Lakh rupees in a year. Maximum balance should not exceed Rs. 50,000/- at any time. Cash withdrawals & transfers must not exceed Rs.10, 000/- in a month. Remittance from foreign account cannot be credited to this account without completing normal KYC formalities. This account can be opened only at Core Banking Solution linked branches of banks or at such branches, where it is possible to manually monitor the fulfillments of the conditions.

a) Basic Savings Bank Deposit Accounts (BSBDA)

• This account will be considered as normal banking service.
• For this account, maintenance of minimum balance is not required.
• ATM card/ ATM cum Debit card, Rupay card will be given for the account holders.
• There are going to be no limit on the number of deposits that can be made in a month but, account holders will be allowed most of 4 withdrawals in a month, which includes ATM withdrawals also.
• The above facilities will be given without any charge. There will be no charge levied for non-operation/ activation of in-operative basic saving bank deposit account.
• For this account, overdraft facility will be provided up to Rs. 5000/-.

b) Basic Saving bank Deposit Accounts Small scheme (BSBDS)

• These are accounts with relaxed KYC, with a minimum document requirement of self-attested address proof & photograph.
• Total credit should not exceed 1Lakh rupees in a year.
• Maximum balance should not exceed Rs. 50,000/- at any time.
• Cash withdrawals & transfers must not exceed Rs.10, 000/- in a month.
• Remittance from foreign account cannot be credited to this account without completing normal KYC formalities.
• This account can be opened only at Core Banking Solution linked branches of banks or at such branches, where it is possible to manually monitor the fulfillments of the conditions.

Any resident individual- single accounts, two or more individuals in joint accounts, Associations, clubs etc., are eligible for this account. Modest credit option available to the depositor. Two free cheque books will be issued per year. Internet banking facility will be provided without any charge. Balance enquiry, NEFT, Bill payment, Mobile recharge etc., are provided through mobile phones. Students can open this account with zero balance by providing the required documents.

• Any resident individual- single accounts, two or more individuals in joint accounts, Associations, clubs etc., are eligible for this account.
• Modest credit option available to the depositor.
• Two free cheque books will be issued per year.
• Internet banking facility will be provided without any charge.
• Balance enquiry, NEFT, Bill payment, Mobile recharge etc., are provided through mobile phones.
• Students can open this account with zero balance by providing the required documents.

Any resident individual- single accounts, two or more individuals in joint accounts, Associations, Limited companies, Religious Institutions, Educational Institutions, Charitable Institutions, clubs etc., are eligible for this account. Payments can be done unlimited number of times. Funds can be remitted from any part of the country to the corresponding account. Overdraft facility will be available. Internet banking facility is available.

• Any resident individual- single accounts, two or more individuals in joint accounts, Associations, Limited companies, Religious Institutions, Educational Institutions, Charitable Institutions, clubs etc., are eligible for this account.
• Payments can be done unlimited number of times.
• Funds can be remitted from any part of the country to the corresponding account.
• Overdraft facility will be available.
• Internet banking facility is available.

CUMULATIVE DEPOSIT SCHEME Any resident individual- single accounts, two or more individuals in joint accounts, Associations, clubs, Institutions/Agencies specifically permitted by the RBI etc., are eligible to open this account in single/joint names. Periodic/Monthly installments can be for any amount starting from as low as Rs.50/- onwards. Account can be opened for any period ranging from 6 months to 120 months, in multiple of 1 month. The amount selected for installment at the start of the scheme will be payable every month. The number of installments once fixed, cannot be altered. Approved rate of interest is compounded every quarter. The amount after maturity will be paid to customers one month after the deposit of the last installment. Pass book will be given to the depositor. TDS will be applicable on the interest, as per the latest changes in the Income Tax Act on cumulative deposits also.

CUMULATIVE DEPOSIT SCHEME

• Any resident individual- single accounts, two or more individuals in joint accounts, Associations, clubs, Institutions/Agencies specifically permitted by the RBI etc., are eligible to open this account in single/joint names.
• Periodic/Monthly installments can be for any amount starting from as low as Rs.50/- onwards.
• Account can be opened for any period ranging from 6 months to 120 months, in multiple of 1 month.
• The amount selected for installment at the start of the scheme will be payable every month.
• The number of installments once fixed, cannot be altered.
• Approved rate of interest is compounded every quarter.
• The amount after maturity will be paid to customers one month after the deposit of the last installment.
• Pass book will be given to the depositor.
• TDS will be applicable on the interest, as per the latest changes in the Income Tax Act on cumulative deposits also.

a) SHORT DEPOSIT RECEIPT Banks accepts deposits from customers varying from 7 days to a maximum of 10 years. The period of 7 days & above but not exceeding 179 days deposits is classified as ‘Short Deposits’. The minimum amount that can be deposited under this scheme is Rs. 5 lakh for a period of 7-14 days. b) FIXED DEPOSIT RECEIPT Any resident individual- single accounts, two or more individuals in joint accounts, Associations, Minors, societies, clubs etc., are eligible for this account. The minimum FDR in metro & Urban branches is Rs. 10,000/- & in rural & semi urban & for Senior citizens is Rs.5000/- . For the subsidy kept under the government sponsored schemes, Margin money, earnest money & court attached/ordered deposits, minimum amount criteria will not be applicable. Depositors may ask for repayment of their deposits before maturity. Repayment of amount before maturity is allowable. Interest rate differs from bank to bank depending upon the tenure of the deposits & as when the bank changes the rate. Additional interest of 0.50% is offered for senior citizens on deposits placed for a year & above.

a) SHORT DEPOSIT RECEIPT

• Banks accepts deposits from customers varying from 7 days to a maximum of 10 years.
• The period of 7 days & above but not exceeding 179 days deposits is classified as ‘Short Deposits’.
• The minimum amount that can be deposited under this scheme is Rs. 5 lakh for a period of 7-14 days.

b) FIXED DEPOSIT RECEIPT

• Any resident individual- single accounts, two or more individuals in joint accounts, Associations, Minors, societies, clubs etc., are eligible for this account.
• The minimum FDR in metro & Urban branches is Rs. 10,000/- & in rural & semi urban & for Senior citizens is Rs.5000/- .
• For the subsidy kept under the government sponsored schemes, Margin money, earnest money & court attached/ordered deposits, minimum amount criteria will not be applicable.
• Depositors may ask for repayment of their deposits before maturity. Repayment of amount before maturity is allowable.
• Interest rate differs from bank to bank depending upon the tenure of the deposits & as when the bank changes the rate.
• Additional interest of 0.50% is offered for senior citizens on deposits placed for a year & above.

Used to conduct stress-free transactions on the shares. An individual, Non-Resident Indian, Foreign Institutional Investor, Foreign National, Corporate, Trusts, Clearing Houses, Financial Institution, Clearing Member, Mutual Funds, Banks and Other Depository Account. For opening this account, an individual has to fill a form, submit a photo of the applicant along with a photocopy of Voter ID/ Passport/ Aadhar card/ Driving License & Demat account number will be provided to the applicant immediately after the completion of processing of the application. Facilities provided under this account are- Opening & maintaining of Demat accounts, Dematerialization, Rematerialization, Purchases, sales, Pledging & Unpledging, safe custody.

• Used to conduct stress-free transactions on the shares.
• An individual, Non-Resident Indian, Foreign Institutional Investor, Foreign National, Corporate, Trusts, Clearing Houses, Financial Institution, Clearing Member, Mutual Funds, Banks and Other Depository Account.
• For opening this account, an individual has to fill a form, submit a photo of the applicant along with a photocopy of Voter ID/ Passport/ Aadhar card/ Driving License & Demat account number will be provided to the applicant immediately after the completion of processing of the application.
• Facilities provided under this account are- Opening & maintaining of Demat accounts, Dematerialization, Rematerialization, Purchases, sales, Pledging & Unpledging, safe custody.

a) NRO ( Non-Resident Ordinary Rupees) Accountb) NRE ( Non-Resident External Rupees) Accountc) FCNR ( Foreign Currency Non-Resident ) Account SpecificsFCNRNRENRO Account openingNRIs/PIOs/OCIs(Individuals/entities of Bangladesh/Pakistan require prior approval of RBINRIs/PIOs/OCIs(Individuals/entities of Bangladesh/Pakistan require prior approval of RBIAny Individual resident outside India Joint AccountIn the names of two or more non-resident individuals. With a local close relative on 'former or survivor basis'In the names of two or more non-resident individuals. With a local close relative on 'former or survivor basis'In the names of two or more non-resident individuals. With a local close relative on 'former or survivor basis' Money in which account is denominatedUS dollar, pound sterling, Yen, Euro, Australian dollar & Canadian dollarIndian RupeesIndian Rupees NominationAllowableAllowableAllowable Account TypeTerm Deposit onlySavings, Current, Fixed, Recurring depositSavings, Current, Fixed, Recurring deposit Interest RateBanks are allowed to determine interest rates for DepositsBanks are allowed to determine interest rates for DepositsBanks are allowed to determine interest rates for Deposits Fixed deposits-periodnot less than 1 year and not more than 5 yearsMin- 1yearMax- 10yearsAs applicable to resident accounts Income TaxNot TaxableNot TaxableTDS on Interest received on NRO deposits to be deducted at 30.90% RepatriabilityRepatriableRepatriableNot Repatriable Loans in India1)To account holder2)To third partiesWithout any financial ceiling on the loan amount subject to standard margin requirementsWithout any financial ceiling on the loan amount subject to standard margin requirements1)Permitted2)Permitted Loans in Abroad1)To account holder2)To third parties1) Without any financial ceiling on the loan amount subject to standard margin requirements2)Not PermittedWithout any financial ceiling on the loan amount subject to standard margin requirements1)Not permitted2)Not permitted Foreign Currency loans India1)To Account holder2)To third parties1) Permitted2) Not permitted1) Not permitted2) Not permitted1) Not permitted2) Not permitted

a) NRO ( Non-Resident Ordinary Rupees) Account
b) NRE ( Non-Resident External Rupees) Account
c) FCNR ( Foreign Currency Non-Resident ) Account

Specifics	FCNR	NRE	NRO
Account opening	NRIs/PIOs/OCIs(Individuals/entities of Bangladesh/Pakistan require prior approval of RBI	NRIs/PIOs/OCIs(Individuals/entities of Bangladesh/Pakistan require prior approval of RBI	Any Individual resident outside India
Joint Account	In the names of two or more non-resident individuals. With a local close relative on 'former or survivor basis'	In the names of two or more non-resident individuals. With a local close relative on 'former or survivor basis'	In the names of two or more non-resident individuals. With a local close relative on 'former or survivor basis'
Money in which account is denominated	US dollar, pound sterling, Yen, Euro, Australian dollar & Canadian dollar	Indian Rupees	Indian Rupees
Nomination	Allowable	Allowable	Allowable
Account Type	Term Deposit only	Savings, Current, Fixed, Recurring deposit	Savings, Current, Fixed, Recurring deposit
Interest Rate	Banks are allowed to determine interest rates for Deposits	Banks are allowed to determine interest rates for Deposits	Banks are allowed to determine interest rates for Deposits
Fixed deposits-period	not less than 1 year and not more than 5 years	Min- 1year Max- 10years	As applicable to resident accounts
Income Tax	Not Taxable	Not Taxable	TDS on Interest received on NRO deposits to be deducted at 30.90%
Repatriability	Repatriable	Repatriable	Not Repatriable
Loans in India 1)To account holder 2)To third parties	Without any financial ceiling on the loan amount subject to standard margin requirements	Without any financial ceiling on the loan amount subject to standard margin requirements	1)Permitted 2)Permitted
Loans in Abroad 1)To account holder 2)To third parties	1) Without any financial ceiling on the loan amount subject to standard margin requirements 2)Not Permitted	Without any financial ceiling on the loan amount subject to standard margin requirements	1)Not permitted 2)Not permitted
Foreign Currency loans India 1)To Account holder 2)To third parties	1) Permitted 2) Not permitted	1) Not permitted 2) Not permitted	1) Not permitted 2) Not permitted