Indian Banks Raise $136 Billion via RBI Swap Facility

Indian banks raised more than $136 billion through a special USD-INR forex swap facility introduced by the Reserve Bank of India on June 8, 2026. The initiative aimed to counter rupee pressure caused by capital flight from foreign portfolio investors and high oil prices. Provisional data released September 2 shows that Foreign Currency Non-Resident (Bank) deposits accounted for the bulk of the inflows at $127.23 billion, while overseas foreign currency borrowings and external commercial borrowings contributed $5.26 billion and $3.89 billion, respectively.

Due to an unexpectedly strong response, the central bank moved the closure date for FCNR(B) deposit mobilization forward from September 30 to August 31, though the swap facility for those deposits remains available until September 11. The ECB and OFCB schemes remain open until December 31, 2026. The Government of India described the effort as the largest and fastest foreign-currency mobilisation exercise in the country's history, resulting in banking-system liquidity reaching ₹6.65 lakh crore, the highest level since May 2022.

As part of this broader trend, ICICI Bank mobilised approximately $17.88 billion through FCNR-B deposits. The lender used these funds to provide $9 billion in loans through its international branches and subsidiaries and issued $3.63 billion in guarantees or standby letters of credit. Additionally, ICICI Bank issued $3.55 billion in US dollar-denominated bonds during July and August 2026.