RBI Ends Discounted Forex Swap Window Early After Strong Inflows Exceed $56 Billion
News Mania Desk/ Piyal Chatterjee/ 14th August 2026
The Reserve Bank of India (RBI) has decided to prematurely close its discounted foreign exchange swap facility for Foreign Currency Non-Resident (Bank) [FCNR(B)] deposits after the scheme attracted robust inflows exceeding $56 billion in just over two months.
In a statement issued on Friday, the central bank said the swap facility for FCNR(B) deposits will now be available only for deposits mobilised until August 31, a month earlier than the original September 30 deadline. Banks will be permitted to undertake swaps with the RBI under the scheme until September 11. However, similar facilities for External Commercial Borrowings (ECBs) and Overseas Foreign Currency Borrowings (OFCBs) will continue until December 31 as previously announced.
The RBI said the decision was driven by the strong response received from banks and overseas depositors, which resulted in substantial foreign exchange inflows. According to central bank data, total inflows under the facility stood at $56.85 billion as of August 13. FCNR(B) deposits accounted for the largest share at $52.3 billion, while OFCBs contributed $2.81 billion and ECBs brought in $1.74 billion.
The concessional swap window was introduced in June as part of a broader package of measures aimed at strengthening India’s balance of payments and boosting foreign currency inflows amid global economic uncertainty. Under the arrangement, banks were allowed to raise fresh FCNR(B) deposits with maturities ranging from three to five years and swap the dollar inflows with the RBI at highly favourable terms.
The scheme generated significantly higher inflows than many market participants had initially anticipated. Analysts had estimated that the RBI’s measures could attract between $50 billion and $80 billion, with some projections later revised upward as deposits accelerated. The latest figures have already surpassed the mobilisation achieved under a similar FCNR(B) scheme launched during the 2013 currency crisis.
