RBI swap facility attracts over $20.7 bn forex inflows since June 8

The Reserve Bank's concessional swap facility has attracted foreign exchange inflows of more than $20.7 billion since its launch on June 8, with FCNR(B) deposits accounting for the bulk of the inflows.

According to data released by the Reserve Bank of India on Monday, total inflows mobilised under the facility stood at $20.718 billion as of July 17.

Fresh Foreign Currency Non-Resident (Bank) or FCNR(B) deposits contributed $17.406 billion, while Overseas Foreign Currency Borrowings (OFCBs) brought in $1.97 billion.

External Commercial Borrowings (ECBs) accounted for $1.342 billion.

The RBI had announced the concessional swap facility on June 5 as part of a series of measures aimed at strengthening India's balance of payments and encouraging capital inflows.

The facility was operationalised on June 8. It will remain available till September 30, 2026, for fresh FCNR(B) deposits, while OFCBs and ECBs will be eligible under the scheme till December 31, 2026.

“The swap facility has seen avid interest and attracted steady forex inflows since June 8, 2026,” the central bank said.

Banks remain optimistic of a sharp pick-up in foreign currency non-resident (FCNR-B) deposits before the RBI's September 30 deadline for the special scheme.

Bank executives said they are forging relevant partnerships with overseas entities to help execute the flows, noting that actual activity on the scheme only began at the end of June, after the central bank issued FAQs clarifying all the necessary points.

They have also pointed out some issues, including tax treatments in certain jurisdictions that make such investments infeasible, and noted that tapping non-resident Indians in the Middle East, Singapore, and Hong Kong is best suited to the scheme's success.

Among public sector lenders, Punjab National Bank has mobilised $425 million against its target of $2.5 billion, Union Bank of India has garnered $106 million against the targeted $2 billion, Indian Bank has collected $140 million against its $2 billion goal, while Central Bank of India has mobilised just $8.8 million against a target of $400 million.