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Big banks ask RBI to scrap fixed forex exposure cap in favor of smarter limits
Economy
Published on 11 May 2026
They want caps that change with each bank’s risk
Large state-owned and private banks have urged the RBI to reconsider a uniform cap on unhedged forex exposure. Instead of one fixed limit, they propose dynamic regulation that ties a bank’s NOP to its size, business flows, and overall risk profile. Bank officials say this approach could better balance stability and flexibility as FX markets evolve.
- Banks want RBI to move away from a single uniform forex cap
- Proposal links unhedged exposure limits to NOP, bank size, and flows
- Regulation would be risk-based rather than one-size-fits-all
- RBI is expected to evaluate feasibility and market impact
Read the full story at The Economic Times
This summarization was done by Beige for a story published on 
The Economic Times