Mobilisation under the FCNR(B) deposit scheme has started on a subdued note, suggesting that early inflows may fall short of the large market estimates that circulated when the window opened. The initial surge of interest appears to have cooled, even as lenders continue to position the product aggressively for overseas Indians.
A mix of factors is keeping NRI participation measured. Tax considerations are influencing decision-making, while the narrowing gap between India and US yields has reduced part of the scheme’s appeal. At the same time, other investment avenues are competing for the same pool of funds, making deposit mobilisation slower than some banks had hoped.
Despite the cautious start, banks are not backing away from their collection goals. Many are stepping up outreach efforts and focusing on the period through the end of September, when they expect participation to improve. The strategy appears to be centered on sustained engagement rather than relying on the early excitement that followed the scheme’s launch.
For now, the picture is one of tempered expectations rather than disappointment. While inflows may remain below the most ambitious projections, banks still see room for stronger collections if market conditions and investor sentiment turn more favorable in the coming weeks.
