As of September 18, the inflow of funds through the Reserve Bank of India's (RBI) preferential currency swap window reached $143.5 billion. The majority of these receipts consisted of FCNR(B) deposits, which approached $133 billion.
The RBI reported that the total amount of funds attracted through the preferential currency swap window, launched on June 8, includes FCNR(B) deposits, Overseas Foreign Currency Borrowings (OFCBs), and External Commercial Borrowings (ECBs). As of September 18, the amounts for OFCBs and ECBs were $5.32 billion and $5.3 billion, respectively.
The figures for the mobilization of FCNR(B) deposits are current as of August 31, the closing date for attracting new deposits. Previously, on September 2, the RBI indicated that banks had attracted slightly over $127 billion through FCNR(B) deposits under this program as of August 31.
The increase in the volume of attracted FCNR(B) deposits was made possible because the central bank allowed banks to use the swap mechanism with the central bank until September 11, 2026, for deposits opened before August 31. Initially, the central bank launched the preferential currency swap to attract foreign currency inflows into the banking system and first kept the FCNR(B) window open until September 30.
However, the window for FCNR(B) deposits was closed a month earlier due to a strong response from banks. This significant volume of attraction is partly due to banks offering higher interest rates to attract FCNR(B) deposits. Furthermore, some banks provided leverage on such deposits, allowing Non-Resident Indians (NRIs) to potentially increase the return on their investments.
The volume of attraction turned out to be significantly higher than market forecasts, which were between $90–$100 billion. Although the RBI window for FCNR(B) deposits closed on August 31, it remains open for OFCBs and ECBs until December 31.