Key Details
The RBI’s special USD-INR swap facility mobilised $72.85 billion between June 8 and August 21, 2026.
FCNR(B) deposits: $65.40 billion, or 89.8% of the total
Overseas borrowings by banks: $4.86 billion
External commercial borrowings: $2.59 billion
Earlier benchmark: The comparable 2013 FCNR(B) programme raised about $26 billion
Revised deadline: Fresh FCNR(B) mobilisation closes on August 31, against September 30 earlier; banks can complete the corresponding swaps until September 11
Other windows: ECB and overseas bank-borrowing facilities remain available until December 31, 2026
The composition and deadlines are confirmed by the RBI’s latest mobilisation data and its revised closure announcement.
NRI Deposits Powered the Mobilisation
The response has been led overwhelmingly by Foreign Currency Non-Resident (Bank), or FCNR(B), deposits. At $65.40 billion, this component alone is more than twice the amount raised through the entire 2013 programme.
The inflow points to strong demand for these deposits, supported by the RBI’s concessional swap terms, which reduce the cost and currency risk faced by banks when converting the foreign currency into rupees. The scale therefore reflects both depositor participation and the financial attractiveness of the facility—not confidence alone.
The Facility Provides Foreign-Exchange Liquidity, Not Free Reserves
Under the arrangement, banks place eligible foreign currency with the RBI and receive rupees for domestic use. The exchange is reversed at maturity on predetermined terms.
The $72.85 billion figure represents gross mobilisation under the facility. It should not be read as an equivalent permanent increase in India’s foreign-exchange reserves: the dollars carry future repayment or swap-reversal obligations.
Only the Deposit Window Is Closing Early
The accelerated closure applies specifically to FCNR(B) deposits, which have already met the RBI’s mobilisation objective. The channels covering external commercial borrowings by Indian entities and overseas foreign-currency borrowings by banks remain open through the end of December.
This distinction matters because the facility is shifting from NRI-led deposit mobilisation towards institutional foreign borrowing.
What Are the Three Funding Channels?
FCNR(B): Fixed deposits maintained by eligible overseas Indians in foreign currency, protecting depositors from rupee exchange-rate movements.
ECB: Foreign-currency borrowing by eligible Indian companies and other entities from overseas lenders.
OFCB: Funds borrowed in foreign currency by Indian banks from overseas markets.
Policy Relevance
Near-term support: The inflows can augment foreign-currency liquidity, support banks’ rupee funding and provide the RBI with greater room to manage external-market volatility.
Cost and maturity management: The eventual reversal of swaps and repayment of deposits and borrowings require close monitoring of their maturity concentration, hedging costs and rollover risk.
Transparent measurement: Public communication should distinguish between gross foreign-currency mobilisation, net capital inflows and changes in usable foreign-exchange reserves.
Use of funds: The longer-term economic benefit will depend on whether banks channel the resulting rupee liquidity towards productive credit without weakening lending standards.
Relevant Question for Policy Stakeholders: Can the immediate liquidity benefit be converted into productive domestic lending while avoiding a concentrated repayment and rollover burden when the deposits and swaps mature?
Follow the Full Update Here: RBI’s USD-INR Swap Facility Mobilises $73 Billion