NRI Deposit Inflows Fall 22% to $2.8 Billion in Q1 FY27

Key takeaways

• NRI deposit inflows fell 22% year on year to $2.8 billion in Q1 FY27.
• The decline shows that overseas Indians placed less fresh money in Indian bank accounts.
• Currency moves, interest rates and better options abroad can affect these deposits.
• NRI deposits still give Indian banks a steady source of foreign currency.

NRI deposit inflows means fresh money that Indians living abroad place in Indian bank accounts. These inflows fell 22% to $2.8 billion in the first quarter of FY27, according to data cited by BusinessLine. The drop came even as remittances remain a major support for India’s external finances.

The figure covers April to June 2026, the first quarter of the financial year. It compares with about $3.6 billion in the same period a year earlier. That means banks received roughly $800 million less in new NRI deposits.

What NRI deposit inflows show about overseas Indian money

Non-resident Indians, or NRIs, are Indian citizens who live and work outside the country. They can keep special bank accounts in India, often in rupees or foreign currencies.

These accounts help NRIs send savings home. They also help banks bring foreign currency into India. Foreign currency means money such as US dollars, euros or dirhams.

The latest NRI deposit inflows number does not mean NRIs stopped sending money to India. It only measures money placed in deposit accounts. An NRI may still send money to family, buy property or invest in shares.

India received $2.8 billion in fresh NRI deposits during the quarter. The earlier figure was about $3.6 billion. The $800 million gap equals a fall of nearly 22%.

Measure	Q1 FY26	Q1 FY27	Change
Fresh NRI deposits	About $3.6 billion	$2.8 billion	Down 22%
Period	April-June 2025	April-June 2026	Year on year

Why did NRI deposit inflows fall?

One reason may be the return available in other countries. If a bank in the Gulf, the US or Europe offers better rates, an NRI may keep more money there.

Interest rates are the cost of borrowing and the reward for saving. Small rate gaps can matter when someone is choosing where to place thousands of dollars.

Currency changes can also shape the decision. If the rupee looks likely to weaken, an NRI may hold dollars instead. This protects the value of money in the currency where the person earns.

Remittance habits may have changed too. Remittances are money workers send to people or accounts in another country. A worker may send money directly to family instead of parking it in a deposit.

India’s overseas Indians also have many investment choices. They can buy mutual funds, shares, bonds or homes. So, a lower deposit figure doesn’t automatically mean lower confidence in India.

The drop may also reflect timing. Large deposits can arrive in one quarter and move out in another. Businesses and families often shift money around tax dates, holidays or major payments.

Why NRI deposit inflows still matter to banks

Indian banks value NRI deposits because they widen access to foreign currency. That can help banks support importers and other customers who need dollars.

These deposits can also improve a bank’s funding mix. Funding mix means the different sources a bank uses to lend money. A stable deposit base can reduce pressure to borrow from markets.

However, banks must manage exchange risk. Exchange risk is the chance that currency values move against a bank or customer. A sudden rupee change can alter the value of a foreign-currency deposit.

Some banks are responding with special campaigns for overseas customers. For example, SBI’s NRI deposit target shows how large lenders are competing for this pool of money.

That competition may increase if NRI deposit inflows stay weak. Banks could offer better rates, smoother online services or faster transfers. But higher rates can also raise a bank’s cost.

Fresh NRI deposits, US$ billion3.62.8Q1 FY26Q1 FY27Down 22% year on year

What could happen next?

The next few quarters will show whether the fall was temporary. Banks and policymakers will watch deposit data alongside remittances, interest rates and the rupee.

A recovery in NRI deposit inflows could give banks more foreign-currency funds. It could also signal that overseas Indians find Indian deposit returns more attractive.

On the other hand, another weak quarter would suggest a deeper shift. NRIs may be keeping savings abroad or using other ways to invest in India.

Readers should separate deposits from total money sent by overseas Indians. The two figures answer different questions. Deposit data tracks bank savings, while remittance data tracks transfers for many uses.

The Reserve Bank of India publishes data on deposits and external flows through its official website. Its releases provide the best place to check later updates.

The clearest takeaway is simple: India received $2.8 billion in fresh NRI deposits in Q1 FY27, down 22% from a year earlier. The fall matters for banks, but it does not by itself show that overseas Indians have reduced all money sent to India.

FAQs

What are NRI deposit inflows?

They are fresh funds that Indians living abroad place in bank deposits in India.

Why did NRI deposit inflows fall in Q1 FY27?

Possible factors include overseas interest rates, currency moves, remittance choices and the timing of large deposits.

How much did NRI deposits fall?

Fresh inflows fell 22% year on year, from about $3.6 billion to $2.8 billion.