Response to this Question

    NRIs can lend to residents as follows:

    To close relatives on repatriation basis for their personal/ business purpose (agriculture and few other businesses prohibited) in foreign exchange up to USD 2,50,000 provided the loan is interest free and the minimum maturity period of loan is one year.
    By way of non-convertible debentures denominated in Rupees and issued by public companies in India on repatriation and non-repatriation basis with a minimum maturity of three years. The interest rate cap is Prime-lending rate of SBI plus 300 basis points.
    By way of loan/ deposits in Rupees on non-repatriation basis to residents with a maximum maturity of three years. The interest rate cap is Bank rate plus 200 basis points.
    Significantly, even loans/ deposits on non-repatriation basis can now be repatriated under the USD 1 million per calendar year route.

Date : 29-Nov-2019 

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