New Delhi, July 13 (ANI): Union Finance Minister Nirmala Sitharaman on Monday urged public sector banks (PSBs) and public financial institutions (PFIs) to intensify outreach to the non-resident Indian (NRI) community and sustain the momentum of foreign currency mobilization under the Reserve Bank of India’s (RBI) swap schemes.
Sitharaman was addressing managing directors and chief executive officers of PSBs and PFIs in New Delhi on the RBI’s Foreign Currency Non-Resident (Bank) [FCNR(B)] deposits, External Commercial Borrowings (ECBs), and Overseas Foreign Currency Borrowings (OFCBs) swap initiatives.
The meeting was attended by the secretaries of the Departments of Financial Services, Economic Affairs, and Revenue, along with the Chief Economic Adviser, the RBI deputy governor, and other senior officials.
According to a Finance Ministry press release, banks reported strong participation in the schemes.
“It was noted that these initiatives have received an encouraging response from the Indian diaspora abroad, with healthy interest across FCNR(B), ECBs and OFCBs,” the ministry said.
Managing directors and chief executive officers said there had been significant interest from NRIs in Singapore, Hong Kong, the Middle East, the United Kingdom, the United States, and other overseas markets.
Banks said they are offering attractive returns, including on five-year FCNR(B) deposits, supported by the suspension of the interest rate ceiling on new FCNR(B) deposits under the scheme.
Bank executives also outlined plans to build on the positive momentum and accelerate deposit mobilization during the remainder of the program.
“They also expressed confidence that ECB mobilisations would gather stronger traction during the third quarter of the current fiscal year (October-December 2026),” the ministry said.
According to the press release, public sector banks have implemented customized outreach strategies, including digital channels, to engage the NRI community and increase deposit mobilization.
They also reported that FCNR(B) deposit mobilization has shown a clear accelerating trend, supported by the attractive returns being offered.
Banks said they are also leveraging International Banking Units (IBUs) at the International Financial Services Centre (IFSC) in GIFT City, Gujarat, to raise funds from multiple jurisdictions, including the United Kingdom, the United States, the Middle East, Hong Kong, Singapore, and Southeast Asia.
Sitharaman urged banks to maximize the use of the financial services ecosystem and institutional infrastructure available at GIFT City.
The RBI deputy governor said the central bank is actively supporting banks and financial institutions in mobilizing deposits and facilitating eligible borrowings.
The ministry also noted that the RBI’s daily reporting framework has enabled transparent, real-time monitoring of progress across participating institutions.
The RBI announced the schemes on June 5, 2026. They include a U.S. dollar-rupee foreign exchange swap facility at par for new FCNR(B) deposits and a concessional swap facility for eligible ECBs and OFCBs.
FCNR(B) deposits are eligible under the scheme through Sept. 30, 2026, while ECBs and OFCBs qualify through Dec. 31, 2026.
According to the ministry, the broad participation of public sector banks, private sector banks, and public financial institutions demonstrates the effectiveness of the swap facilities in attracting foreign currency inflows, strengthening India’s foreign exchange reserves, and enhancing the resilience of the country’s external sector amid global economic uncertainty. (ANI)
About The Author
