RBI exempts loans against fresh NRI deposits from PSL calculation

The Story in Brief

The Reserve Bank of India on Friday allowed banks to exclude rupee loans against fresh FCNR(B) and NRE deposits from the calculation of adjusted net bank credit for priority sector lending targets. The exemption applies to FCNR(B) deposits of three to five years mobilised between June 8 and September 30, 2026, and NRE term deposits of three years or more mobilised between June 19 and September 30, 2026. Only deposits that qualify for CRR and SLR exemption are eligible, and the exclusion is capped at the amount of such fresh deposits. The RBI also scrapped an old 2013/14-based calculation method.

The move follows the RBI's earlier decision to offer a dollar-rupee swap and CRR/SLR exemption on these deposits. Data shows FCNR(B) deposits jumped 86% to $60.55 billion by July 30, 2026, with HSBC, SBI and ICICI Bank accounting for half the inflows. Governor Sanjay Malhotra has said there is no plan to close the scheme before the September 30 deadline. India's balance of payments surplus for FY27 is estimated at $40 billion, with a current account deficit of 1.7% of GDP, according to a report by IDFC FIRST Bank.