MoD assigns Private Sector Banks to provide financial services for overseas procurement

MoUs in this connection have been signed with each of these three banks recently by PCDA, New Delhi on behalf of MoD.

In line with further opening of allocation of Government business to Private Sector Banks by the Department of Financial Services, MoD has assigned three Private Sector Banks viz HDFC Bank Ltd., ICICI Bank, and Axis Bank to provide the Letter of Credit and Direct Bank Transfer business for overseas procurement by the Ministry. MoUs in this connection have been signed with each of these three banks recently by PCDA, New Delhi on behalf of MoD.

Till now, only authorised public sector banks were utilized to provide these services to MoD. With this for the first time three Private Banks have also been allowed to provide financial services for overseas procurement by MoD.

The selected banks may be allocated with LC business of Rs 2000 Crore, each on the capital and revenue side, for a period of one year on concurrent basis (Rs 666 Crore for each bank under both capitals as well as Revenue). The performance of these Banks will be monitored regularly so as to take necessary further action as required.

(With Inputs from PIB)