Under the revised rates, effective June 15, SBI is offering up to 4.40% on US dollar-denominated FCNR(B) deposits with maturities of one year and above one year to less than two years, while rates for the three- to five-year bucket range between 2.95% and 3.35%.
For other currencies, SBI is offering up to 4.25% on Australian dollar deposits, 4% on British pound deposits, 3.01% on Canadian dollar deposits, 2.75% on euro deposits and 0.40% on Japanese yen deposits, depending on the tenor.
The move comes after the RBI unveiled a special FCNR(B) swap facility and exempted incremental FCNR(B) deposits mobilised between July 1, 2026 and September 30, 2026 from cash reserve ratio (CRR) and statutory liquidity ratio (SLR) requirements.
The measures are aimed at encouraging banks to mobilise foreign currency deposits and strengthen external sector buffers.
A broad-based increase in FCNR(B) deposit rates
has been seen across Indian lenders in recent days. Private sector lenders including ICICI Bank and Axis Bank have raised dollar deposit rates to 6% across the three- to five-year maturity bucket, while Kotak Mahindra Bank is offering up to 6.15% for larger-ticket deposits.
YES Bank has raised rates to as high as 6.60%, and CSB Bank has hiked its peak USD FCNR(B) rate to 7.05% for five-year deposits.
Public sector lenders have also joined the repricing cycle.
Bank of Baroda launched a special FCNR(B) deposit scheme offering up to 6% on five-year US dollar deposits, while Punjab National Bank and several other lenders have revised their FCNR(B) offerings in recent weeks.
According to Dharmendra Maurya, Co-Founder and CEO of Rupeeflo, banks have sharply increased FCNR(B) rates because the RBI’s swap window has removed the biggest cost hurdle associated with mobilising such deposits — the hedging cost, which previously stood at around 2.5% annually.
Maurya noted that the combination of lower costs and regulatory exemptions has fundamentally improved the economics of FCNR(B) mobilisation, leading to rate hikes of 250-310 basis points by several lenders almost overnight. He added that competition among banks for NRI deposits has already intensified, with multiple banks revising rates within days of the RBI’s operational circular.
Analysts believe higher FCNR(B) inflows could help diversify banks’ funding bases, improve foreign currency liquidity and support India’s external sector by boosting stable capital inflows.