The revised rates will come into effect from June 11.
Under the scheme, the bank is offering up to 6% interest on US dollar deposits with a five-year maturity. Interest rates on five-year deposits have been set at 4.75% for British Pound Sterling and Australian Dollar deposits, 5.15% for Canadian Dollar deposits and 3.75% for Euro deposits.
The move comes days after the RBI unveiled a series of measures to encourage foreign currency inflows, including a special swap facility for FCNR(B) deposits under which the central bank will absorb the hedging cost for eligible deposits. The facility is available for deposits mobilised up to September 30 and is expected to support reserve accumulation and rupee stability.
‘s new deposit scheme provides NRIs with an opportunity to earn enhanced returns on their foreign currency deposits,” said Beena Vaheed, Executive Director, Bank of Baroda.
Several lenders have revised FCNR(B) deposit rates following the RBI’s announcement.
Banks including HDFC Bank, Punjab National Bank, Central Bank of India, Karur Vysya Bank and AU Small Finance Bank have increased rates on FCNR(B) dollar deposits in the three-to-five-year maturity segment to attract overseas deposits.
According to DBS Bank economist Radhika Rao, the RBI’s FCNR(B) and external commercial borrowing (ECB) swap facilities could collectively bring in incremental inflows of $50-60 billion, helping narrow India’s balance of payments gap, support foreign exchange reserves and stabilise the rupee.
The RBI’s measures were announced alongside data showing an improvement in India’s external sector position. India’s current account recorded a surplus in the January-March quarter of FY26, supported by strong growth in services exports and remittance inflows, while non-resident deposits and external borrowings contributed to capital account inflows.
The central bank and government have positioned the latest measures as part of a broader effort to strengthen external sector resilience amid evolving global financial conditions.
