Forex swap facility attracts $56.8 billion in total inflows
The Reserve Bank of India's special foreign exchange swap facility has generated $56.85 billion in total inflows since June. Following strong demand for foreign currency non-resident deposit swaps, the RBI set an August 31 deadline for mobilization.
FCNR deposits dominate total swap receipts
The Reserve Bank of India launched the special USD-INR forex swap facility on June 8, 2026, covering Foreign Currency Non-Resident deposit accounts alongside external commercial borrowings and overseas foreign currency borrowings.
Authorised Dealer Banks reported $56.85 billion in total inflows under the window through August 13, 2026.
Foreign Currency Non-Resident deposits accounted for the overwhelming majority of the total, attracting $52.30 billion.
In contrast, Overseas Foreign Currency Borrowings contributed $2.81 billion, while External Commercial Borrowings generated $1.74 billion.
The substantial response reflects robust commercial bank interest in securing dollar-rupee swap liquidity during the deployment period.
Phased window closures begin in September
Encouraged by the high volume of deposit inflows, the Reserve Bank of India announced a structured timeline to wind down the deposit leg of the facility.
The swap window for Foreign Currency Non-Resident deposits will remain open only for funds mobilized up to August 31, 2026.
Participating banks can subsequently execute the corresponding swaps with the central bank through September 11, 2026.
Meanwhile, the swap framework for External Commercial Borrowings and Overseas Foreign Currency Borrowings will continue operating as originally scheduled until December 31, 2026.
Short-term relief with structural limits
The influx of deposit swaps provided swift liquidity, yet the early closure highlights reluctance to accumulate high-cost liabilities.
Closing deposit swaps while preserving corporate borrowing windows redirects funds toward longer-term channels.
This prudent tweak balances reserve growth against balance sheet risks.