Small and mid-sized lenders are increasing FCNR (B) deposit rates as they step up efforts to attract non-resident Indian customers. The move reflects a broader scramble for fresh foreign currency deposits, with smaller banks trying to stay competitive in a market where larger institutions already have stronger visibility among NRIs.
FCNR (B), or Foreign Currency Non-Resident Bank deposits, are an important funding avenue for banks seeking overseas currency inflows from Indian depositors living abroad. By offering better returns, smaller lenders appear to be using pricing as their main tool to win a bigger share of these deposits.
The trend highlights the growing intensity of competition in NRI banking. Large banks often benefit from scale, branch reach and established customer relationships, so smaller and mid-tier players are responding by making their FCNR (B) offerings more attractive on interest rates.
For NRI depositors, the shift could translate into more choice and improved returns on foreign currency deposits. For banks, it signals a focused push to mobilise overseas funds and avoid losing ground in the race for FCNR (B) business.
