Mumbai (Maharashtra) [India], September 10 (ANI): State Bank of India Chairman CS Setty has dismissed concerns that massive Foreign Currency Non-Resident (Bank) deposit inflows could trigger reckless credit expansion, stating the funds will be absorbed gradually over the coming months.
Speaking to reporters on the sidelines of the Global Fintech Fest 2026 in Mumbai on Thursday, Setty addressed the liquidity surge following the conclusion of the central bank's concessional swap window.
“I don't think the FCNR-B inflows we have gotten will lead to any sort of abnormal lending… it'll take at least three to four months to deploy these inflows into the banking system,” Setty said.
When asked about SBI's specific share of the mobilization, Setty declined to disclose the exact figure raised by the country's largest state-owned lender, which had set an initial target of nearly USD 10 billion.
The Reserve Bank of India launched its concessional swap facility on June 8 to attract fresh FCNR(B) deposits, external commercial borrowings, and overseas foreign currency bonds.
The scheme triggered massive foreign capital inflows, reaching USD 136.4 billion by August 31.
Commercial banks mopped up USD 127.2 billion in FCNR(B) deposits alone—far outpacing market expectations of USD 90–100 billion.
Due to the overwhelming response, the RBI advanced the scheme's closing date to August 31, ending the window a month earlier than its original September 30 deadline.
Separately, in an exclusive interaction with ANI, Setty also pointed to rapid structural shifts in capital market infrastructure, highlighting the transition toward asset tokenisation.
"This is a wider movement towards tokenisation. If you remember we had done tokenisation of certificate of deposits and now this is a next instrument …market instruments are getting tokenised, it’s a good beginning," Setty said. (ANI)
FCNR cash inflows won't cause abnormal lending, liquidity deployment to take 3–4 months: SBI Chairman
