Economic TimesLean R·
Banks can offer loans for FCNR (B), rebook deposits, RBI clarifies
Indian banks can now lend against FCNR(B) deposits, with the RBI offering forex swaps only on the principal amount. This move aims to attract dollars by absorbing currency hedging costs for banks, boosting FCNR(B) rates to 6-7.1%. The central bank also clarified rules for stand-by letters of credit and introduced a swap facility for external commercial borrowings, easing dollar hedging for businesses.
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