India Banks’ Funding Costs Rise as RBI Ends Deposit Window Early

Indian banks are facing a significant increase in short-term borrowing costs following the Reserve Bank of India's decision to prematurely end its overseas deposit facility. This move has removed a crucial, cheaper, and more stable source of funding for these lenders, leading to the steepest monthly rise in borrowing costs in a while. This shift underscores the challenges banks now face in securing funding and highlights the broader implications for India's financial sector stability and its reliance on alternative funding sources.