HDFC, ICICI, Axis Bank allowed to provide services for overseas procurement
The Defence Ministry on 7 July has approved three Private Sector Banks to provide financial services in overseas procurement.
The ministry has allowed HDFC Bank, ICICI Bank and Axis Bank to provide letter of credit and direct bank transfer business for overseas procurement.
In this regard, PCDA on behalf of the Ministry of Defence had recently signed a Memorandum of Understanding (MoU) with these three banks in New Delhi.
Till now only authorized public sector banks were used to provide these services to the Ministry of Defence.
For the first time, three private sector banks have also been allowed by the Defence Ministry to provide financial services for overseas procurement.
Selected banks can be allotted with LC business of Rs 2,000 crore (Rs 666 Crore for each bank under both capital as well as Revenue) on capital and revenue side for a period of one year on concurrent basis.
The performance of these banks will be regularly monitored so that further action can be taken as required.
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