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HindustanHT US NewsNifty 50Auto NewsMint MoneyREITSBanks receive $36.7 billion under FCNR depositsThe new deposit
incentive scheme allows NRIs to make leveraged deposits and runs till the end of September, with the central bank taking
the hedging risk, offering overseas investors the potential to earn up to 14% return on their money. Shayan
GhoshUpdated1 Aug 2026, 11:09 AM ISTRBI's swap facility has seen avid interest and attracted steady forex inflows
since 8 June(AFP)AI Quick ReadMumbai: Non-resident Indians (NRIs) have poured $36.7 billion into Indian banks through
foreign currency non-resident (FCNR) deposits under a new deposit incentive scheme to attract dollars and strengthen the
rupee.Announced on 5 June and rolled out three days later, the scheme allows NRIs to make leveraged deposits and runs
till the end of September, with the central bank taking the hedging risk, offering overseas investors the potential to
earn up to 14% return on their money.The Reserve Bank of India (RBI) on Saturday said its dollar swap facility received
a total of $40.8 billion till 31 July, with FCNR-B deposits accounting for the lion’s share. Apart from FCNR(B)
deposits, the swap window also received $2.6 billion in overseas foreign currency borrowings and $1.5 billion through
external commercial borrowings. Commercial banks exchange dollars for rupees at the swap window at guaranteed rates.The
swap facility has seen avid interest and attracted steady forex inflows since 8 June, the RBI had said in a press
release on 20 July. Also Read | Can India mop up $50 billion under RBI's FCNR (B) scheme?Tanvee Gupta Jain, Chief
India Economist, UBS said in a note on 30 July that RBI's measures announced in June to incentivise foreign currency
inflows—including relaxed norms for FCNR(B) deposits and overseas borrowings under the RBI-subsidised swap
window—have already attracted approximately US$32bn in inflows in around 45 days, with FCNR(B) deposits accounting for
the bulk of these flows.“The FCNR (B) window will remain open until 30 September, leaving room for more inflows. We
believe use of the leveraged borrowing facility by the banks is driving the bulk of the deposit accretion,” said
Gupta.Citing the UBS India banking team, Gupta said that most banks are sounding positive on the prospects of raising
deposits through FCNR (B), although the numbers reported by Indian banks so far—excluding foreign banks and SBI (which
has yet to report)—do not appear sufficient to explain the $32bn mobilisation.On 20 July, Mint reported India's
largest private sector banks remain tight-lipped on how much they have collected under the scheme, while their public
sector rivals talk of both collections and targets.During their June quarter earnings calls, top executives of India's
first, second and third-largest private banks – HDFC Bank, ICICI Bank and Axis Bank – did not reveal FCNR(B) deposit
figures. However, these banks have repeatedly said that the response from non-resident Indians (NRIs) has been strong
and that they see this opportunity as significant. Also Read | Burnt fingers, cold feet: Inside NRI reluctance to fund
India’s dollar dreamIn contrast, several public sector banks have disclosed both collections and targets.Union Bank of
India is aiming to garner FCNR deposits of around $1.5-2 billion by the end of September. So far, the state-owned lender
has raised $106 million from NRIs without any leverage, managing director Asheesh Pandey said in a post-earnings media
conference on 15 July.About the AuthorShayan GhoshShayan leads the coverage for banking and finance in Mint. Based in
Mumbai, he has spent 15 years as a journalist, joining the Mint team in 2018. Over the years, he has tracked the Reserve
Bank of India (RBI), commercial banks, and the complex world of shadow banking.<br><br>His expertise goes
beyond just reporting news, and he specializes in explaining the "why" behind India’s financial shifts.
Shayan has covered major milestones in the industry, including the rollout of the Insolvency and Bankruptcy Code (IBC),
mergers in the banking and non-banking space, and the many challenges facing the country's credit markets. He has
tracked cases of wrongdoings at India’s private sector banks and murky boardroom battles, trying to get behind the
scenes.<br><br>Shayan is driven by a commitment to accuracy and clear, honest reporting. He believes in
making finance easy to understand, ensuring his readers and investors stay informed about the forces shaping their
money. When not at work, he tries to hone his amateurish photography skills, read fiction, and listen to music. You can
follow his work and updates on LinkedIn and Twitter/X.Catch all the Industry News, Banking News and Updates on Live
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