RBI removes cap on NRI deposit rates until September

The RBI has removed the interest rate cap on FCNR-B deposits of three to five years and NRE accounts of three years and above, effective immediately until September 30, 2026. Banks had already raised FCNR-B rates by 250-450 basis points following the regulator's decision to bear hedging costs, and may now push rates further to about 8 percent or beyond to attract long-tenor deposits. The move is expected to help banks strengthen their asset-liability management and liquidity coverage ratios.