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Banks Rush Overseas as RBI Forex Swap Window Nears Closure

Banks Rush Overseas as RBI Forex Swap Window Nears Closure
Why are banks rushing to raise billions of dollars through overseas bonds? · businesstoday.in

The Reserve Bank of India created a special program to help banks bring dollars into India.

Banks could borrow dollars overseas and exchange them for rupees at a cheaper rate.

Later, they could exchange the rupees back into dollars.

The RBI also agreed to pay the cost of protecting against currency changes.

This made raising money overseas less expensive for banks.

Banks raised almost $73 billion in just 11 weeks.

The FCNR (B) part of the program became so popular that it will close early on August 31.

Banks are now trying to use other overseas borrowing routes before the remaining deadline.

Key facts

Total funds raised
Nearly $73 billion in 11 weeks
FCNR (B) deposits
About $65.4 billion raised as of August 22
Overseas foreign currency borrowings
About $4.9 billion raised
External commercial borrowings
About $2.59 billion raised
FCNR (B) closing date
August 31, 2026, moved forward from September 30
Other window closing date
The OFCB and ECB windows remain open until December 31, 2026
Previous comparable mobilization
A similar 2013 window raised $26 billion

Sources

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