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Full flow FCNR deposits could hit $100 billion

By Sohail Khan 25 August 2026, 12:32 am

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Business News›News›Economy›Finance›Full flow FCNR deposits could hit $100 billion, beat estimates

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Full flow FCNR deposits could hit $100 billion, beat estimates

Synopsis

Strong FCNR(B) deposit inflows have led analysts to raise their estimates for dollar mobilisation through the scheme. Jefferies now expects inflows to reach $90-100 billion by August 31, up from its earlier estimate of $70-80 billion.

Illustration shows U.S. dollar banknotes — Jefferies raises forecast to $90-100 bn by August 31 as banks tap strong overseas demand.

Mumbai: Strong momentum in foreign currency non-resident (bank), or FCNR (B), deposit inflows over the past week has prompted some analysts to raise their estimates for dollar inflows through the scheme.

Analysts said strong fundraising by banks and demand for the scheme among overseas investors mean inflows could exceed earlier estimates. Jefferies India said in a note on Monday that it now expects FCNR inflows to reach $90 billion to $100 billion by the time the scheme closes on August 31, compared with its earlier estimate of $70 billion to $80 billion. The new estimate is also higher than the $80 billion that RBI governor Sanjay Malhotra estimated in an interview with a newspaper last week.

ET Bureau

"Indian banks have mobilised US$16bn over 8 days (13-21 Aug) through FCNR-B and other schemes to a total of $73bn, exceeding our estimates. Given substantial debt issuance completed recently and in prospect, banks could cross our estimated range of raising $70-80bn, landing at $90-100bn by Aug 31," Jefferies analyst Prakhar Sharma said in the note.

ALSO READ | FCNR deposits emerge as banks’ new FY27 growth lever: Report

Data released on Saturday showed FCNR (B) deposits accounted for a disproportionate share of the total dollar inflows, at $65.39 billion out of $72.80 billion.

Banks added another $13 billion through the FCNR (B) window over the past week, taking the total from $52.30 billion as of August 13, the latest RBI update showed.

ALSO READ | India raises $72.8 billion via overseas deposits, loans, central bank says

Higher inflows also mean the central bank will have to spend more to provide the swap facility, said Yes Bank chief economist Indranil Pan.

"Also, since it is a bullet repayment, the dollars will have to be delivered in one go, which will have costs. One estimate we did showed that for $65 billion of inflows, $88 billion of dollars will have to be provided including interest costs," Pan said.

The impact on the rupee has also been limited, with the Indian currency broadly trading in the ₹95 to ₹96 per dollar range and showing no signs of a sharp rise.

"The impact on the rupee has been marginal because oil prices remain high. Unless oil comes down to $75 to $80 per barrel, the pressure on the rupee will continue. We are sticking with our estimate of rupee at ₹97 per dollar by the end of the fiscal year," Pan said.

The Indian currency closed at Rs 95.74 per dollar on Monday. Brent crude was trading at around $93 per barrel on Monday.

Upasna Bhardwaj, chief economist at Kotak Mahindra Bank, said the bank had expected $70 billion of inflows from FCNR (B) deposits but now expects $75 billion to $80 billion because of the momentum.

"Perhaps the RBI expected strong inflows and curtailed the timeline," she said, referring to the RBI advancing the deadline for banks to accept incentive-laden FCNR (B) deposits to August 31 by a month.

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