<prompt> Human: A friend with citizenship in india recently told me about how banks in India offer 7-8 interest backed by the government and that you must have citizenship to use it. I still want to know how this is possible? How does the world market not correct this and why would anyone invest in anything in India besides this interest rate. How can an outsider take advantage of this and is there anything like this in other countries?  <response>: Thats nothing, Argentine banks pay 30! Other posters have covered the inflation side of the equation. While it seems like your money is going to grow much faster, it is also going to lose value relative to the dollar. A quick mathematical example: Lets say you put 100.00 into an Indian Rupee denominated account paying 7 annually on 112015, that would equate to 6,148.30 INR. You withdraw your money on 12312015 and it has grown to 6,578.68 INR. Except when you convert it back to USD it is only worth 99.54, so you actually lost money. 