The Reserve Bank of India has launched a concessional swap facility for FCNR(B) deposits, ECBs, and OFCBs, operational until late 2026. This initiative aims to bolster forex inflows, supporting the country's forex liquidity.
RBI's Concessional Swap Facility for FCNR(B) Deposits and ECBs
The Reserve Bank of India (RBI) has introduced a concessional swap facility for fresh Foreign Currency Non-Resident (Bank) deposits (FCNR(B)), External Commercial Borrowings (ECBs), and Overseas Foreign Currency Borrowings (OFCBs). The announcement was made on June 5, 2026, and the facility became operational on June 8, 2026. It is available for FCNR(B) deposits until September 30, 2026, and for ECBs and OFCBs until December 31, 2026.
According to data collected from Authorised Dealer Banks, the facility aims to enhance foreign exchange liquidity by supporting better forex inflows. This is particularly significant given the current economic landscape, where international funding sources play a crucial role. The swap facility is expected to assist banks in mobilizing necessary foreign capital, especially in a fluctuating market.
Practitioners should closely evaluate the implications of this facility for clients seeking external financing or foreign investments. It opens up new avenues for leveraging foreign currency sources while navigating compliance with RBI mandates.
Citations
- RBI Press Release (2026) 1 RBI 63274