HDFC NRE Account

Is choosing an Indian bank to open an NRE account all about choosing between the lesser evil? Here’s what you can expect from HDFC Bank.

Launched in 1994, HDFC is one of the largest banks in India, in terms of market capitalization. It has 4,805 branches and 12,260 ATMs across 2,657 Indian cities and towns. Outside India, the bank has branches in Dubai, Bahrain and Hong Kong. It is one of the most sought-after banks for NRIs to park their foreign earnings in India.

HDFC NRE Account Features

  1. Allows easy transfer of funds from India to another country and vice versa
  2. Personalized cheque books and free e-mail account statement facility
  3. International debit card that works for retail and online merchant establishments around the globe
  4. Customers can transfer funds from abroad in freely convertible foreign currency. Direct remittance from foreign bank accounts is permitted.
  5. Customers can request to convert foreign currency deposits in Indian rupees, which could save them from the effects of exchange rate fluctuations.
  6. 24/7 net banking facility, with options to pay utility bills in India. Free phone banking services are also available.
  7. Low minimum average balance requirement of ₹10,000 for metro cities and ₹5,000 for rural and semi-urban areas.
  8. Quickremit, IndiaLink, telegraphic transfers and cheque and draft facilities are free for NRE account holders.
  9. Interest rate of 4% on account balance of ₹50 lakhs and above. Interest is paid on a quarterly basis.
  10. Customers can invest in mutual funds by linking their NRE account with an investment savings account in HDFC.
  11. Customers can appoint a mandate, which is a person who runs the account on behalf of them in India.
  12. The sweep-in facility links NRE savings accounts to their fixed deposits. This takes care of interest payments and withdrawals.
  13. Fixed deposit interest rates for tenure of 1 year up to 5 years varies from 7.3% to 7.75%. For fixed deposits of 5 to 10 years, the interest rate is 6.5%.
  14. Digital connectivity across all Indian cities.
  15. Safe deposit lockers available at certain branches.

Limitations

  1. Low interest rates for NRE savings accounts, in comparison with other banks like YES Bank and RBL Bank.
  2. Very low fixed deposit interest rate for tenure greater than 5 years, as compared to Axis Bank, ICICI Bank and SBI.
  3. Customers have complained about the painfully slow and tedious account opening process, which sometimes takes months. Online account opening isn’t recommended.
  4. Poor customer services, especially with phone banking. Customers have complained regarding the lack of prompt response from the support team.
  5. Limited presence outside India, compared to ICICI Bank, Deutsche Bank and SBI.

Advantages

  1. Easy and economical fund remittance from overseas accounts to Indian NRE account.
  2. Feature-rich facilities
  3. Good connectivity even in rural areas, which is offered by only a few banks, like SBI.
  4. Option to invest in mutual funds and SIPs for those looking for wealth creation.

Disadvantages

  1. Slow account opening process
  2. Lower interest rates than many other banks
  3. Poor phone banking support
  4. Not convenient for senior account holders

Have you used HDFCs NRE account services? If yes, please share your experience below.

Leave a Reply