RBI swap’s dollar haul nearly doubles in 10 days

By Sohail Khan 2 September 2026, 6:18 pm

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Business News›News›Economy›Finance›Indian banks raise over $136 bn via RBI forex swap, FCNR(B) deposits dominate inflows

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Indian banks raise over $136 bn via RBI forex swap, FCNR(B) deposits dominate inflows
Synopsis

India's banking system attracted over $136 billion through a special Reserve Bank of India swap facility. Foreign currency non-resident deposits accounted for the largest portion of these substantial inflows. This strong response prompted the Reserve Bank of India to close deposit mobilization earlier than planned. The inflows have significantly boosted banking system liquidity and strengthened foreign exchange reserves.

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India's banking system attracted over $136 billion through a special Reserve Bank of India swap facility

India’s banking system attracted $136.38 billion in foreign currency inflows through the Reserve Bank of India’s special dollar-rupee swap facility by August 31, with foreign currency non-resident (FCNR(B)) deposits accounting for the overwhelming share.

Provisional data released by the RBI on Wednesday showed FCNR(B) deposits brought in $127.23 billion, while overseas foreign currency borrowings (OFCBs) contributed $5.26 billion and external commercial borrowings (ECBs) $3.89 billion. The figures are subject to final reporting, accounting and reconciliation.

Also Read: FCNR rush leaves banks swimming in ₹6.65 lakh crore liquidity

The latest data underscore the exceptionally strong response to the facility, which the RBI introduced on June 8 to attract foreign currency inflows and strengthen India’s external buffers. By August 21, banks had mobilised $65.4 billion through FCNR(B) deposits, while total inflows under the three routes had reached about $73 billion.

The strong response prompted the RBI to bring forward the closure of the FCNR(B) deposit mobilisation window to August 31 from September 30. The swap facility for eligible FCNR(B) deposits already mobilised remains available with the RBI until September 11, while the schemes for ECBs and OFCBs will remain open until December 31, 2026.

The sharp surge in longer-tenure FCNR(B) deposits also reflects banks’ willingness to tap overseas dollar funding while the RBI swap facility reduced the cost and risk associated with managing the foreign currency exposure.

The inflows have added substantially to banking-system liquidity and strengthened the RBI’s foreign exchange firepower. India’s banking liquidity rose to ₹6.65 lakh crore on August 31, its highest level since May 2022, with the weighted average call rate falling to 4.98%, well below the repo rate.

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FCNR(B) depositsIndian banks foreign currency inflowsRBI forex swapexternal commercial borrowingsRBI foreign exchange reservesoverseas foreign currency borrowingsforeign currency fundingIndia banking liquidityReserve Bank of India

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