Foreign exchange inflows under the Reserve Bank of India’s special USD-INR forex swap facility have reached $72.85 billion, the Reserve Bank of India (RBI) said on Saturday, based on data reported by authorised dealer banks as of August 21, 2026.

Foreign Currency Non Resident (Bank) [FCNR(B)] deposits, which are targeted mainly at non-resident Indians (NRIs), lead the table, accounting for $65.397 billion so far, with External Commercial Borrowings (ECBs) raising $2.591 billion, and Overseas Foreign Currency Borrowings (OFCBs) accounting for $4.860 billion.   Earlier this month, the RBI announced it would advance the closure of the swap window - which was introduced on June 8 - by a month to August 31, 2026, largely on account of the “encouraging response” to the facility and the “resultant forex inflows”. The facility for ECBs and OFCBs, however, will remain available until December 31, 2026. 

The scheme offers banks a zero-cost principal hedge, regulatory exemptions and leverage facilities, making FCNR(B) deposits attractive for NRIs. However, it is largely a stabilisation and liquidity-enhancement measure rather than a catalyst for rupee appreciation or a boost for foreign exchange reserves.

While the inflow of tens of billions of dollars has boosted deposit growth and is likely to soften deposit rates, it is also expected to dilute banks' margins, with net interest margins (NIMs) likely to be contract by 3-15 basis points (bps). One basis point is a hundredth of a percentage point. However, the impact on margins is expected to be temporary, with NIMs likely to correct going ahead, experts have said. Most banks have also indicated in their Q1FY27 earnings calls that they will look to first replace their high-cost bulk deposits.