The Reserve Bank of India has announced an earlier closure for its special FCNR(B) swap window, driven by unexpected demand from overseas Indians and banks, signalling a shift in India’s foreign currency funding strategy.
The Reserve Bank of India has brought forward the closing date for its special swap facility on Foreign Currency Non-Resident(Bank) deposits, after banks drew in more foreign currency than officials had expected. According to The Economic Times, the window for mobilising FCNR(B) deposits will now shut on August 31, 2026, a month earlier than planned, with the swap facility available for eligible deposits only until September 11, 2026.
The move reflects a stronger-than-anticipated response from overseas Indians and banks seeking to lock in foreign currency funding. As of August 13, the RBI had received $52.30 billion through FCNR(B) deposits, the report said. FCNR(B) accounts allow non-resident Indians to place foreign currency deposits with Indian banks, helping those lenders raise stable overseas funding without immediate rupee conversion.
The special window was revived in June as part of the central bank’s efforts to support foreign currency inflows and ease pressure on the rupee. Business Standard reported that the RBI opened the facility for fresh three- to five-year FCNR(B) deposits mobilised between June 8 and September 30, 2026, while LiveMint said the step echoed a similar mechanism used during the 2013 rupee crisis. The RBI had also required banks to report daily mobilisation data for FCNR(B) deposits, external commercial borrowings and overseas foreign currency borrowings under the concessional swap schemes.
The ECB and OFCB swap facility will continue to run until December 31, 2026, as originally scheduled, according to The Economic Times. That means the central bank is closing the FCNR(B) leg early because demand has been brisk, while leaving the wider foreign borrowing support programme in place for longer.
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