Reserve Bank of India unveils swap facilities to bolster reserves
The Reserve Bank of India just announced two fresh moves to strengthen the country's foreign exchange reserves and keep risks in check.
One is a dollar-rupee swap facility for External Commercial Borrowings (ECBs), for public sector undertakings and Authorized Dealer Category-I Banks raising Overseas Foreign Currency Borrowings (OFCBs).
The other is a similar swap window for fresh FCNR(B) deposits mobilized between June 8 and September 30, 2026, hoping to bring in more overseas money.
External Commercial Borrowings and FCNR(B) incentives
The ECB swap is open until January 2027 for loans with at least a three-year maturity, letting banks trade dollars with the RBI at a 1.5% annual premium.
For fresh FCNR(B) deposits mobilized between June 8 and September 30, 2026, banks can tap into swaps once a week, and those fresh deposits are exempt from CRR and SLR, making things simpler.
Economists are upbeat, predicting the deposit scheme could pull in $40 billion, thanks to its attractive terms for both banks and nonresident Indians.