HDFC Banks allowed to provide financial services for defence ministry
July 08, 2022
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, according to an official statement released by the Ministry of Defence on Thursday.
MoUs in this connection have been signed with each of these three banks recently by PCDA, New Delhi on behalf of the Ministry of Defence, it said.
Till now, only authorised public sector banks were utilised 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 ₹2000 crore, each on the capital and revenue side, for a period of one year on a concurrent basis (₹666 crore for each bank under both capital as well as Revenue).