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Banks from 18 countries get RBI's nod to trade in rupee: Centre in RS

Speaking in Rajya Sabha, Union Minister of State for Finance Bhagwat Kishanrao Karad said that 60 such approvals have been given by the RBI

RBI | Indian rupee | Rajya Sabha

BS Web Team  |  New Delhi 

Rupee trade

The (RBI) has permitted banks from 18 countries to open Special Vostro Accounts (SVRAs) to settle payments in rupees, the government said. Speaking in Rajya Sabha, Union Minister of State for Bhagwat Kishanrao Karad said that 60 such approvals have been given by the .

These 18 nations include Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, Russia, Seychelles, Singapore, Sri Lanka, Tanzania, Uganda and the United Kingdom.

SVRAs could be set up by the banks by approaching the Authorised Dealer (AD) banks in India and it may then get permission from the after completion of the due process. The SVA process began in 2022 when announced, "it has been decided to put in place an additional arrangement for invoicing, payment, and settlement of exports/imports in INR [Indian rupees]."

Karad also said that Russia has been vocal in using the for trade and for "de-dollarisation"

"Procedures for trade in INR have been delineated by RBI in the Circular (No 10 RBI/2022-2023/90 dated 11.07.2022 on ‘International Trade Settlement in Indian rupees’. RBI has also issued FAQs on its website. RBI has clarified matters related to the operationalisation of SRVAs through the said FAQs, which are available to banks, importers and exporters etc," Karad added.

SVRAs are used to keep the foreign company's holdings in the Indian bank in the form of the .

When an Indian importer makes a payment to a foreign trader in rupees, the amount gets credited to this vostro account. Similarly, when an Indian exporter needs to be paid for his goods and services in rupees, money will get deducted from this account. It will then be credited to the exporter's regular account.

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First Published: Wed, March 15 2023. 16:50 IST