FCNR(B) deposits hit $52.3 billion, scheme may touch $65–70 bn by Sept 30
Synopsis
India's FCNR(B) scheme has pulled in $52.3 billion — and is accelerating so fast that the RBI has closed the swap window a month early. With $65–70 billion expected by September-end and forex reserves crossing $707 billion, this is shaping up as the largest NRI deposit mobilisation drive in recent memory.
Key Takeaways
$52.3 billion mobilised under the FCNR(B) scheme as of 15 August 2026 ; cumulative total reached $56.8 billion by 13 August .
Total inflows projected at $65–70 billion by scheme close on 30 September 2026 ; up to $80–85 billion including OFCBs and ECBs.
The RBI has curtailed its swap facility to deposits mobilised only up to 31 August 2026 , citing strong uptake since 8 June 2026 .
The RBI has already recouped $31 billion in Foreign Currency Assets — nearly 55% of the amount mobilised — as of 7 August 2026 .
India's forex reserves crossed $707 billion in the week ended 7 August 2026 , with FCAs rising $9.946 billion to $574.625 billion .
SBI Research identifies the 3–7-year G-Sec segment as the primary beneficiary of deposit-to-yield transmission from the inflow surge.
India's Foreign Currency Non-Resident Bank (FCNR(B)) deposit scheme has mobilised $52.3 billion as of mid-August, with total inflows projected to reach $65–70 billion by the scheme's close on 30 September 2026, according to an SBI Research report released on Saturday, 15 August 2026. The figure, which accounts for a one-month truncation of the swap window, underscores the scheme's unexpectedly strong uptake since it opened in June.
Key Mobilisation Milestones
The pace of inflows has accelerated sharply over time. The first $20 billion was mobilised over 38 days, but the next $20 billion arrived in just 14 days. In the 13-day window between 1–13 August alone, an additional $16 billion flowed in, pushing the cumulative total to $56.8 billion as of 13 August 2026. When Overseas Foreign Currency Bonds (OFCBs) and External Commercial Borrowings (ECBs) are included, total dollar mobilisation could reach $80–85 billion, the report noted.
RBI Cuts Swap Window Short
Encouraged by the robust response, the Reserve Bank of India (RBI) has decided to prematurely close its swap facility for FCNR(B) deposits. The swap window, which has attracted steady forex inflows since 8 June 2026, will now be available only for deposits mobilised up to 31 August 2026 — a curtailment of roughly one month from the original timeline. The RBI, in a statement, described the interest as 'avid' and the resulting inflows as 'steady'.
Impact on Forex Reserves
The surge in foreign-currency deposits has already had a visible impact on India's external buffers. According to the SBI Research report, the RBI has recouped approximately $31 billion in Foreign Currency Assets as of 7 August 2026, equivalent to nearly 55 per cent of the amount mobilised under the scheme. Separately, India's overall foreign exchange reserves rose sharply by $14.136 billion in the week ended 7 August 2026, crossing the $707 billion mark. Foreign Currency Assets (FCAs), which constitute the largest share of forex reserves, climbed by $9.946 billion to $574.625 billion during the same week.
Bond Market Implications
Beyond the forex impact, the SBI Research report flags a secondary transmission channel: the surge in bank deposits and foreign-currency funding is expected to lower the counterfactual level of government securities (G-Sec) yields through deposit-to-yield transmission. The report identifies the 3–7-year bond segment as the clearest beneficiary, citing maturity matching, carry advantages, and lower supply pressure. The 7–10-year segment is expected to benefit next, as the liquidity effect filters through the curve.
What Comes Next
With the swap window closing on 31 August 2026 and the scheme itself ending on 30 September 2026, the final mobilisation tally will be closely watched as a gauge of NRI confidence in India's macroeconomic stability. The trajectory of forex reserves and G-Sec yields in the weeks ahead will determine whether the scheme's secondary market effects match the headline inflow numbers.
Point of View
14 days for the next — is the real story here, not just the headline figure. It signals that NRI confidence in the rupee and Indian macro fundamentals is running higher than official projections anticipated. The RBI's decision to close the swap window early is prudent: it locks in gains without over-committing the central bank's balance sheet to long-dated swap obligations. What mainstream coverage underplays is the G-Sec yield angle — if deposit-to-yield transmission holds, the 3–7-year segment could see meaningful compression, effectively lowering the government's borrowing cost at a time when fiscal consolidation remains a work in progress. The scheme's true test will be whether the $31 billion already recouped in Foreign Currency Assets translates into durable reserve adequacy or merely flatters a single week's data point.
NationPress
15 Aug 2026
Frequently Asked Questions
What is the FCNR(B) deposit scheme and how much has it raised?
The Foreign Currency Non-Resident Bank, or FCNR(B), scheme allows NRIs to hold fixed deposits in India in foreign currencies. As of 15 August 2026, it has mobilised $52.3 billion, with the cumulative total reaching $56.8 billion by 13 August, according to an SBI Research report.
Why has the RBI ended the FCNR(B) swap facility early?
The Reserve Bank of India curtailed its swap facility to deposits mobilised only up to 31 August 2026 — roughly one month ahead of the original schedule — citing 'avid' interest and steady forex inflows since the scheme opened on 8 June 2026. The early closure reflects the scheme's stronger-than-expected uptake.
How much are total FCNR(B) inflows expected to reach by September 2026?
SBI Research projects total FCNR(B) mobilisation at $65–70 billion by the scheme's end date of 30 September 2026, even after the one-month swap window truncation. Including OFCBs and ECBs, the broader dollar mobilisation figure could reach $80–85 billion.
What has been the impact on India's forex reserves?
India's foreign exchange reserves crossed $707 billion in the week ended 7 August 2026, rising $14.136 billion in a single week. Foreign Currency Assets climbed $9.946 billion to $574.625 billion. The RBI has also recouped approximately $31 billion in Foreign Currency Assets — about 55% of the FCNR(B) amount mobilised.
How does the FCNR(B) surge affect government bond yields?
SBI Research argues that the surge in bank deposits and foreign-currency funding should lower G-Sec yields through deposit-to-yield transmission. The 3–7-year bond segment is seen as the clearest beneficiary due to maturity matching and lower supply pressure, followed by the 7–10-year segment.
