April 20, 2004
RBI/2004/164
DNBS (PD) CC. No. 36 / 02.01 / 2003-04
To,
All Non-Banking Financial Companies,
Miscellaneous Non-Banking Companies and
Residuary Non-Banking Companies
Dear Sirs,
Non-Banking Financial Companies, Miscellaneous Non-Banking
Companies and Residuary Non-Banking Companies - Interest rate on NRI deposits
Please refer to the following company circulars
(i) DNBS (PD) C.C. No.30 / 02.01 / 2003-04 dated
September 17, 2003 together with notification No. 175 of date
(ii) DNBS (PD) C.C. No.31 / 02.01 / 2003-04
dated September 19, 2003 together with notification No. 176 of date and
(iii) DNBS (PD) C.C. No.32 / 02.01 / 2003-04
dated October 28, 2003
(iv) DNBS (PD) C.C. No.33 / 02.01 / 2003-04
dated October 30, 2003
on the above subject in terms of which the NBFCs, MNBCs and
RNBCs were directed that in future, the rate of interest payable by them on
fresh repatriable NRI deposits shall be the same as is payable by the scheduled
commercial banks on NRE deposits.
2. Reserve Bank of India has since revised the interest rate
payable on the NRE deposits accepted by scheduled commercial banks and it has
been decided that the rate of interest on these deposits should not exceed the
LIBOR / SWAP rates for US dollar of corresponding maturity.
3. Accordingly, it is advised that the rate of interest on
the NRI deposits payable by NBFCs, MNBCs and RNBCs shall not exceed the LIBOR/SWAP
rates for US dollar of corresponding maturity on fresh deposits contracted from
the close of business on April 17, 2004. The maturity period of repatriable
NRI deposits would continue to be one to three years. The change in interest
rate will also apply to repatriable NRI deposits renewed after their present
maturity period.
4. You are requested to ensure strict compliance with the above
mentioned ceilings.
Yours faithfully,
Sd/-
( O. P. Aggarwal )
Chief General Manager-in-Charge