The Reserve Bank of India’s (RBI) incentives to attract Foreign Currency Non-Resident (Bank) (FCNR(B) deposits have prompted leading private-sector banks to approach overseas lenders with proposals aimed at financing their non-resident Indian (NRI) clients and encouraging them to place funds through this route. “Foreign banks will gain access to a large NRI customer base and tap secured lending opportunities with limited credit risk. We, in turn, can multiply FCNR deposits beyond our existing dollar liquidity, while NRIs benefit from interest-rate arbitrage,” said a senior banker at a private-sector lender. According to sources, HDFC Bank, Axis Bank and IndusInd Bank have lined up proposals for offshore lenders as they compete for a share of the estimated $50 billion expected to flow through the FCNR(B) route.