# Foreign Currency (Non Resident) Quarterly Income Deposits Calculator | FNCR Calculator

The Foreign Currency Non Resident (FNCR) Calculator to calculate the discounted interest using principal amount and rate of interest of a fixed deposit account which accepts deposits in other countries currencies.

 Principal Amount Rate of Interest
 Discounted Interest

## Foreign currency non-resident (FCNR) quarterly income deposits: Earn FOREX-risk free interest

Are you a non-resident willing to invest in your home country, but unsure about the risks relating to currency fluctuations? FCNR deposits could be the answer to all your needs. FCNR deposits offer a range of benefits when you open foreign currency fixed deposit accounts in your home country.

Banks offer FCNR deposits in all major currencies that includes: GBP, USD, AUD, SGD, EUR, CAD, HKD and JPY. Terms and conditions on each currency deposit may differ from bank to bank.

To calculate FCNR quarterly income deposit you don't need to go through heavy calculations; you just require a simple online tool that's easy to use and saves your time. An FCNR quarterly income deposit calculator can help you see the actual value of interest you will earn on your FCNR deposits. Thus you can compare different plans offered by various banks, and shop around to get the best deal possible.

## How the FCNR income deposit calculator works

The FCNR calculator designed by iCalculator helps you calculate the discounted interest rate for fixed deposits made in foreign currency. The calculator works on compounding interest rate concept that shows the importance of time value of money. Only two simple entries are to be made in the calculator:

• Principal Amount: Enter the amount in any foreign currency that you are planning to invest in FCNR deposits.
• Rate of Interest: Enter the interest rate offered by your bank on FCNR deposits.

On the basis of the above mentioned entries the calculator will provide you with the discounted interest value that is compounded on a quarterly basis.

## Two factors that that have a major impact on FCNR are:

1. Compounding: a compounding period means the time frame after which the earned or payable interest is added to the principal amount of investments. This means your interest earns interest.
2. Time value of money: The money received today is worth more than money received next year. This is because you can start making profits immediately by investing money today, rather than receiving the same amount on a later date. In other words, the time spent waiting for the money to be collected is the money wasted.

## Advantages of FCNR income deposits

• The biggest advantage of FCNR deposits is that it protects you from forex rate risks as they are maintained in foreign currencies. You don't lose any value of the money in a conversion. The principal and interest are transferred in the same currency.
• All the FCNR deposits are fully repatriable which means the funds are transferred to your home country.
• Interest earned on FCNR deposits is generally tax free in the home country.
• You can make any of your family members back home as the nominee of the deposit in case of death.
• Some banks offer loans to individuals as well as to the corporate customers on the collateral of FCNR deposits.
• FCNR deposits use the compounding method for interest calculations which means that the interest rates are comparatively higher than that of normal deposits.

Let's take a look at some of the disadvantages of investing in FCNR deposits:

• Generally the interest on FCNR deposits is payable upon the completion of 1 year. In case of withdrawal before 1 year from the date of deposit, the interest amount will be lost.
• If the deposits are made in week banks, they might not be able to pay back on maturity.
• FCNR deposits cannot be jointly held by any resident person of your home country.
• While FCNR deposits could be tax exempt in the home country, they could be subject to tax in the country of residence. All non-residents should consult with tax experts to understand the tax implications better.
• These deposits are offered as term deposits only, not for current, recurring or savings.

FCNR deposits bring foreign currency cash flow that is beneficial for the growth of any country. However, the high interest rates offered for these deposits can cause loss to an economy, it depends how the funds are invested and managed. Therefore, it is quite possible that the bank in charge may reduce the interest rates or might discontinue the facility.

## Conclusion

FCNR deposits are an excellent way of earning a safe interest. You get to save your money in the currency you want without having to lose any value and earn better interest. However, the disadvantages should be considered and discussed with professional tax consultants before you proceed with any investments.