RBI, Bank of Russia to meet this week to discuss bilateral payment system

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RBI, Bank of Russia to meet this week to discuss bilateral payment system

People familiar with the matter told ET that the Reserve Bank of India RBI and the Bank of Russia are going to meet this week to give the finishing touches to a bilateral payment system that will ensure smooth trade flows between the two nations without the use of global sanctions. Russia is facing tighter sanctions after having invaded Ukraine at the end of February. The two sides will meet to discuss payment solutions such as Loro or Nostro accounts. The first is a third-party account, where a bank holds an account in a country for another bank. The second involves a bank holding an account in another country in another bank. One of the persons cited above said we will look into how we can open those accounts in the national currencies of Russia and India. The two-day meeting is likely to be held in New Delhi on Wednesday and Thursday. Besides central bankers, officials from ministries, banks and financial institutions from both sides will also be in attendance. A person involved in the exercise said that the magnitude of the meeting between two countries is noteworthy, although the discussions will be extended before both countries reach a conclusion. The Bank of Russia and the RBI didn't respond to ET's queries. Individual institutions couldn't be contacted immediately for comment. SBI will likely represent Indian bankers along with the National Payments Corporation of India NPCI and the Foreign Exchange Dealers Association of India FEDAI said. One person said that people of general manager status are likely to join from our side, while finance ministry officials are expected to be in attendance. The SberBank and VEB Bank Russia executives are expected to be present along with officials from Russia's trade and foreign ministries. The people cited above are unable to be cited as Bank Otkritie, Novikombank, Bank Rossiya, Promsvyazbank, VEB and VTB Bank are excluded from the sanctions.