RBI cuts adjusted net bank credit sop for FCNR-linked loans to Aug 31
This story was originally published at 22:53 IST on 11 September 2026
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MUMBAI – The Reserve Bank of India Friday reduced the time period under which it exempted advances out of foreign currency non-resident (banks) deposits and non-resident (external), or NRE, term deposits from the calculation of adjusted net bank credit. The exemptions will now apply to loans against fresh deposits only till Aug. 31 from Sept. 30 earlier, the regulator said in a notification.
The RBI had advanced the closure of the concessional swap facility for FCNR(B) deposits mobilised till Aug. 31 from Sept. 30 earlier. As part of measures aimed at boosting foreign capital inflows, banks mobilised $127.23 billion of FCNR(B) deposits. It had notified the early closure of other such incentives to attract capital after shifting the timing of the scheme.
The central bank had on Aug. 7 amended its priority-sector lending norms to allow exclusion of advances against fresh FCNR(B) deposits with a minimum tenor of three years and a maximum of five years mobilised between Jun. 8 and Sept. 30. Advances against non-resident term deposits of three years or more mobilised between Jun. 19 and Sept. 30 were also excluded from the calculation of adjusted net bank credit.
The amount to be excluded from the adjusted net bank credit calculations for computation of priority-sector targets shall not be higher than the fresh outstanding FCNR(B) and NRE deposits that are eligible for exemption from maintenance of cash reserve ratio and statutory liquidity ratio, the RBI said. End
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Reported by Nandini Sinha
Edited by Rajeev Pai
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