Business & Economy
RBI Swap Draws $72.85 Billion Inflows
Will the record haul keep easing dollar pressure and strengthening reserves?
Will the record haul keep easing dollar pressure and strengthening reserves?
The RBI’s special has become a major channel for converting overseas Indian deposits into and stronger . Banks rushed to mobilise FCNR(B) money far beyond expectations, showing how a central bank backstop can lower costs, improve deposit rates, and turn savings into support for the banking system and the .
After the closes, banks can still execute the for until September 11, 2026. That staggered ending matters because it lets the central bank absorb the foreign currency in an orderly way while preserving the and reserve benefits already raised by the scheme.
By August 21, the has drawn total foreign-currency inflows of $72.85 billion, with FCNR(B) deposits accounting for $65.397 billion. The size of the haul underlines how the programme has added to India’s and helped support dollar liquidity and .
The RBI moves the deadline for fresh from September 30 to August 31, citing the strong response to the facility. The revision means banks can still mobilise deposits only until the earlier date, but against those eligible deposits remain available with the RBI until September 11, 2026.
By mid-August, banks have already raised more than $52 billion under the , indicating that the window is drawing far more money than originally anticipated. The pace of inflows shows unusually strong demand for the , a sign that NRI depositors and banks are responding quickly to the incentive.
Through the first two months of the scheme, FCNR(B) deposits emerge as the main source of inflows under the swap window, showing that the policy is gaining traction with banks and NRIs. The early response points to stronger-than-expected dollar mobilisation, which improves and eases pressure on .
Banks begin using the facility to raise from , turning the swap into a channel for steady foreign-currency inflows. The mechanism lets banks swap dollars with the RBI at par, then reverse the transaction later, which helps them manage and pass on competitive rates to depositors.
The opens a special for fresh , with the aim of pulling in foreign currency and easing banks’ hedging costs so they can offer better terms to . The scheme is designed to strengthen dollar liquidity in the banking system while adding to and supporting financial stability.