New Delhi, July 13 (IANS) The chiefs of public sector banks (PSBs) and financial institutions informed Finance Minister Nirmala Sitharaman on Monday that there was a strong response from NRIs to the higher interests rates and incentives that have been announced across foreign currency non-resident bank deposits FCNR (B) deposits, External Commercial Borrowings (ECBs) and Overseas Foreign Currency Borrowings (OFCBs) swap initiatives.

The banks expect funds flowing in from NRIs to pick up further momentum as they have stepped up their outreach to the Indian diaspora.

The Finance Minister called upon banks to further intensify their outreach to the NRI diaspora, introduce innovative deposit products and sustain the momentum of mobilisation during the remaining period of the schemes.

The managing directors further informed that banks are offering attractive returns on FCNR (B) deposits, including on five-year deposits, supported by the suspension of the interest rate ceiling on fresh FCNR(B) deposits under the scheme.

The MDs and CEOs stated that there has been significant interest from NRIs residing in Singapore, Hong Kong, the West Asia, the United Kingdom, the United States and other overseas jurisdictions.

They outlined their plans to capitalise on the positive sentiment and accelerate deposit mobilisation during the remainder of the scheme period and expressed confidence that ECB mobilisations would gather stronger traction during the third quarter of the current financial year (October-December 2026).

The public sector banks also informed that they have put in place customised outreach strategies, including digital channels, to engage with the non-resident Indian diaspora and enhance deposit mobilisation. They further noted that FCNR(B) deposit mobilisation has shown a clear accelerating trend, supported by attractive returns being offered by banks.

The International Banking Units (IBUs) at the International Financial Services Centre (IFSC), GIFT City, Gujarat, are also being utilised to leverage fund mobilisation from multiple jurisdictions, including the United Kingdom, the United States, the West Asia, Hong Kong, Singapore and Southeast Asia. Smt. Sitharaman also exhorted the banks to maximise utilisation of financial services and institutional infrastructure available at GIFT City.

During the discussion, the RBI Deputy Governor assured that the central bank is actively supporting banks and financial institutions in mobilising deposits and facilitating eligible borrowings. It was also noted that the robust daily reporting framework instituted by the RBI has enabled transparent, real-time monitoring of progress across participating institutions.

The sustained and broad-based participation of public sector banks, private sector banks and public financial institutions underscores the effectiveness of the swap facilities in mobilising foreign currency inflows, reinforcing India’s foreign exchange reserves and strengthening the resilience of the external sector amid global uncertainty.

The schemes, announced by the RBI Governor in the Monetary Policy Statement of June 5, 2026, comprise a US Dollar-Rupee forex swap facility at par for fresh FCNR(B) deposits and a concessional swap facility for eligible ECBs and OFCBs, aimed at attracting foreign capital, strengthening the balance of payments and incentivising capital inflows.

FCNR(B) deposits are eligible under the scheme until September 30, 2026, while ECBs and OFCBs are eligible until December 31, 2026.