Archive · 25 Aug 2026
FCNR(B) Rates Reach 6.75% as RBI Forex Window Closes
Banks are offering higher interest rates to attract foreign-currency deposits from eligible non-residents.
The best listed rate is 6.75% at IDFC FIRST Bank and IndusInd Bank.
These rates apply to US dollar deposits held for three to five years and below $1 million.
The Reserve Bank of India had helped banks by covering the cost of protecting against currency changes.
Many deposits came in, so the RBI decided to close the special deposit window on August 31 instead of September 30.
FCNR(B) deposits made up almost 90% of the $72.848 billion raised through the facility.
Banks may keep their current rates for a while after the window closes.
However, they may have less reason to offer such high rates on new deposits once the special support ends.
IDFC FIRST Bank and IndusInd Bank offer the highest listed rate, 6.75%, on US dollar FCNR(B) deposits for 3–5 years below $1 million.
Central Bank of India and Punjab National Bank offer 6.60%, while Bank of Baroda, Canara Bank and UCO Bank offer 6.50%.
ICICI Bank, HDFC Bank and Axis Bank offer maximum rates of 6.25% for the deposits compared.
The Reserve Bank of India advanced the special FCNR(B) window’s closure from September 30 to August 31 after strong dollar-deposit mobilisation.
The facility mobilised $72.848 billion in foreign-exchange inflows, including $65.397 billion through FCNR(B) deposits, as of August 21.
- Who
- The Reserve Bank of India, Indian banks and eligible non-resident depositors.
- What
- Banks are offering elevated interest rates on 3–5-year FCNR(B) deposits as a special RBI-supported forex facility nears closure.
- When
- The window will close on August 31; rates cited were advertised as of August 17, and inflow data covered through August 21.
- Where
- India’s banking system, involving foreign-currency deposits including US dollars.
- Why
- The RBI introduced hedging-cost support to encourage longer-term FCNR(B) deposits and advanced closure after strong mobilisation of US dollar deposits.
- Top advertised rate
- 6.75% at IDFC FIRST Bank and IndusInd Bank for 3–5-year US dollar deposits below $1 million.
- Top public-sector rate
- 6.60% at Central Bank of India and Punjab National Bank.
- Special window closure
- August 31, advanced from the originally scheduled September 30.
- Total foreign-exchange inflows
- $72.848 billion through FCNR(B) deposits, OFCBs and ECBs, based on data reported through August 21.
- FCNR(B) contribution
- $65.397 billion, or nearly 90% of total inflows.
- Other inflows
- OFCBs contributed $4.860 billion and ECBs contributed $2.591 billion.
- Deposit features
- Eligible non-residents can hold FCNR(B) deposits in specified foreign currencies; interest is generally tax-exempt in India and deposits protect the invested foreign currency from rupee exchange-rate fluctuations.