NRI dollars to get a Citi-led boost via Axis
Citigroup Inc. and Axis Bank have formed a partnership to bolster financing for non-resident Indians (NRIs) investing in foreign-currency deposits. Axis Bank will issue standby letters of credit to support the financing provided by Citigroup through its offshore operations. This arrangement allows NRIs to leverage their investments, potentially boosting inflows from the diaspora.
The Reserve Bank of India (RBI) has been actively attracting dollars by ending its incentive program early, with deposits under the program surpassing $52 billion. The RBI's push to bolster foreign-exchange reserves and ease pressure on the rupee has created opportunities for global banks to provide financing offshore, even without a retail presence in India.
Citigroup exited India's retail banking business in 2022 through a sale to Axis Bank and remains focused on institutional clients. Axis Bank offers rates of up to 6.40% on Foreign Currency Non-Resident deposits, and the RBI introduced a concessional swap facility in June to encourage such deposits.
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