Citigroup-Axis Bank NRI FCNR Deposit Financing Partnership

Why in the news

Two banks tied up to make it easier for non-resident Indians to put money in FCNR deposits.

Key facts

• Partners: Citigroup and Axis Bank.
• Financing: from Citigroup’s offshore operations, for NRI depositors.
• Instrument: Standby Letters of Credit (SBLCs) issued by Axis Bank.
• Expected gain: forex inflows and a boost to India’s foreign exchange reserves.

Exam angle

• Deposit type: FCNR.
• Credit support tool: SBLC.
• Macro link: forex reserves.
• Parties to remember: Citigroup (lender) and Axis Bank (SBLC issuer).