The Reserve Bank of India will offer state-run firms a concessional foreign exchange swap facility, allowing them to hedge overseas borrowings at roughly half of the prevailing market costs, according to some analysts.

The swap will be undertaken at a fixed rate of 1.5% a year for an average maturity of three years and above, the central bank said in a statement Monday. The details came after the RBI announced the facility on Friday as part of its efforts to boost capital inflows into the country.

The move aims to make overseas funding more attractive at a time when the RBI is looking to ease pressure on the rupee after it hit a new low against the dollar last month. 

“The current forward premium is between 2.5-3%, so the RBI’s rate works out to be around half of that,” said Anindya Banerjee, head of research for currencies, commodities and interest rates at Kotak Securities. The discounted rate will encourage overseas borrowings by lowering costs, he said. 

The facility will be available for new borrowings raised through Dec. 31 and remain open until Jan. 15. Under the swap, banks acting as forex intermediaries can sell dollars in multiples of $1 million to the RBI with an agreement to buy these back when the swap matures.

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Published on June 9, 2026