SynopsisAU Small Finance Bank has increased its non-resident deposit rates by up to sixty basis points. The bank raised its peak interest rate on FCNR-B deposits to seven point four percent. NRE deposit rates were also increased to seven point six percent for specific tenures. FCNR-B deposits attract dollar inflows and protect against exchange rate fluctuations. The bank seeks liability-led asset growth through these deposit channels.AgenciesKolkata: AU Small Finance Bank has on Monday raised non-resident deposit rates by up to 60 basis points.The country's largest small finance bank has increased the peak interest rate on foreign currency non-resident bank (FCNR-B) deposits to 7.4% from 7.1% for a three-to-four year tenure. It has raised the rate on non-resident external (NRE) deposits to 7.6% from 7% earlier for 36-45 months.Also Read: Nepal eases post-demonetisation curbs on Indian currency; allows Rs 200, Rs 500 notesFCNR-B deposits are serving as a key channel to attract dollar inflows while protecting against exchange rate fluctuations. NRE deposits are rupee-denominated deposits largely used for local use As NRE deposits are not for repatriation, there is no question of foreign exchange risks.While FCNR-B deposits would be a small part of AU Bank's deposit base, the bank is looking for a liability-led asset growth, executive director Vivek Tripathi told ET. Also Read: UAE’s top bank to offer $1.5 billion for NRIs investing in RBI's forex deposit programMobilisation through the FCNR-B channel is likely to have crossed the 2013 level of $26 billion, according to State Bank of India's economic research report. "Overall, we believe, FCNR-B deposits in the range of $65-70 billion should be received overall in scheme," the report said. (Join our ETNRI WhatsApp channel for all the latest updates)...moreElevate your knowledge and leadership skills at a cost cheaper than your daily tea.Subscribe Now