state ownership UCO Bank In the process of opening an exclusive Vostro account with Russia gazprombank for settlement of business in Rupee Against the backdrop of sanctions imposed by Western countries on Russia after the invasion of Ukraine. Soma Shankara, MD and CEO, UCO Bank said, “The deal between UCO Bank and Gazprombank comes after the Reserve Bank of India implements a system to facilitate international payments through special Vostro accounts to promote trade in rupees. Is.” Offering told PTI on Wednesday.

Under Rupee Withdrawal Arrangements (RDAs), a partner country’s bank opens an exclusive INR VOSTRO account with a bank in India. Prasad said the bank is in the process of opening this special Vostro account with the Russian lender.

“We have got approval from reserve Bank of India To open Vostro account with Gazprombank and currently the process is in progress,” Prasad said without giving a timeline for its completion.

“We have asked them for some papers and it depends on how quickly they send them to complete the process.”

The Kolkata-headquartered bank already has Vostro account-based facility with Iran.

However, this time the Vostro account with Russia is not exclusive, as was the case with Iran in the past, Prasad said.

“This is not done for profitability. For the sake of national interest, we want to promote trade in rupee. This will give a boost to rupee as an international currency,” Prasad said.

Gazprombank, or GPB, is a privately owned Russian bank, the third largest bank in the country by assets. UCO Bank has received around 15 applications from various countries for opening Vostro accounts.

“Around 15 applications have come from different countries. I can only remember Italy right now,” Prasad said.

Earlier this month, the Reserve Bank and the finance ministry asked the top management of banks and representatives of trade bodies to carry forward export and import transactions in rupee terms.

They want banks in India to associate with their foreign counterparts to open special Rupee Vostro accounts to facilitate cross-border trading in Indian currency instead of the popular mode of US dollars.

Currently, a major part of the bilateral trade between India and Russia is settled in rupees due to US-imposed sanctions. Europe After Moscow’s attack on Ukraine.

“Indian importers importing through this mechanism shall make payment in INR, which shall be credited to the special Vostro account of the correspondent bank of the partner country against the invoice for supply of goods or services from the foreign seller/supplier,” RBI had said .

Apart from UCO Bank, Yes Bank It is also said to have tied up with Petersburg Social Commercial Bank (PSCB) of Russia to facilitate trade settlement in Indian currency.

Queries sent to Yes Bank to ascertain the same remained unanswered till the time of going to press.