Module: | FCNR(B) & Loan Regulations
Q13: Arjun requires funds for a business venture in India, and decides to avail a loan against his FCNR(B) deposit. He consults the bank, regarding the loan terms. Which of the following conditions, apply to such loans?
1. The loan can be sanctioned in Indian Rupees, or in foreign currency.
2. The loan proceeds can be freely repatriated abroad, for his overseas business needs.
3. Repayment of the loan can be made, using funds from his NRE account, or local resident resources.
4. The loan proceeds must be used for permissible activities in India, and not for re-lending.
2. The loan proceeds can be freely repatriated abroad, for his overseas business needs.
3. Repayment of the loan can be made, using funds from his NRE account, or local resident resources.
4. The loan proceeds must be used for permissible activities in India, and not for re-lending.
✅ Correct Answer: B
Loans against FCNR(B) can be in INR or foreign currency.
Proceeds cannot be repatriated abroad.
Repayment can be from NRE/NRO/local sources.
End-use restrictions apply.
Proceeds cannot be repatriated abroad.
Repayment can be from NRE/NRO/local sources.
End-use restrictions apply.