Joining the race, Ujjivan Small Finance Bank has increased the interest rate on USD FCNR(B) deposits for the 3-5 year tenure to 7.50% per annum, positioning itself among the highest-paying banks in the segment. Meanwhile, DBS Bank India has revised its rates to offer up to 5.6% per annum on USD FCNR(B) deposits for the same tenure, effective July 1, 2026.
The revisions come after the RBI’s policy initiative aimed at encouraging banks to mobilise stable foreign currency deposits, thereby strengthening India’s foreign exchange reserves and supporting the country’s external sector.
Commenting on the revised offering, Hitendra Jha, Head – Retail Liabilities, TASC & TPP at Ujjivan Small Finance Bank, said the RBI’s move is expected to attract stable foreign currency inflows into the banking system while boosting confidence among NRIs.
“In alignment with the RBI’s vision, we have enhanced the interest rate on our USD FCNR(B) deposits for the 3-5 year tenure to 7.50% per annum, making it one of the most competitive offerings in the industry. The enhancement reflects our commitment to providing attractive investment opportunities for NRIs while contributing to India’s foreign exchange reserves and long-term financial stability,” Jha said.
The bank believes the revised rates will encourage greater NRI participation, mobilise long-term foreign currency deposits and contribute to sustainable economic growth.
DBS Bank India has also aligned its FCNR(B) rates with the RBI’s policy direction, offering up to 5.6% per annum on USD FCNR(B) deposits for tenures ranging from three to five years.The bank highlighted that FCNR(B) deposits allow NRIs to maintain savings in foreign currency while eliminating exchange-rate risk at maturity, as both the principal and interest are repaid in the designated foreign currency. This makes the product particularly attractive for overseas Indians looking to earn competitive returns without taking currency conversion risk.
DBS said its DBS Treasures proposition combines banking, wealth management and investment solutions for NRIs, alongside the enhanced FCNR(B) offering. Eligible customers can also complete digital onboarding from overseas, enabling them to open accounts and invest in FCNR(B) deposits seamlessly without visiting India.
With global interest rates remaining relatively elevated and the RBI encouraging foreign currency inflows, banks are increasingly using FCNR(B) deposits as a key proposition to attract NRI funds. The latest revisions by Ujjivan Small Finance Bank and DBS Bank India underscore intensifying competition in the segment, offering NRIs more attractive options to park their foreign currency savings while supporting India’s external financing needs.
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