Diaspora Deposits Down 29 Percent In Fy20

Non-resident deposits in Indian banks, which contribute nearly one-third of India's foreign exchange reserves, appear to have lost its zing this year.

According to India's Economic times report, in the first five months of FY20, fresh deposit flow from Indian diaspora fell 29% amid fall in deposit rates.

Indians working in the Gulf, who contribute the maximum to the NRI deposit chunk, are showing preference towards mutual funds as lower returns make deposits unattractive as investments, the report says. According to latest Reserve Bank of India data, NRI deposits between April and August saw an inflow of $4 billion, compared with $5.7 billion in the same period last year.

The NRE rupee account, which is mostly used by expatriates employed in the Gulf, saw inflows dipping to $2.5 billion from $4 billion.

 

SOURCE : IIK

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