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Amid increasing interest of the global trading community in the domestic currency, the Reserve Bank of India (RBI) has decided to put in place an additional arrangement for invoicing, payment, and settlement of exports / imports in Indian rupees.

RBI further noted that before putting in place this mechanism, banks will require prior approval from the Foreign Exchange Department of the Reserve Bank of India. The RBI said for settlement of trade transactions, the concerned banks will require Special Rupee Vostro Accounts of correspondent bank/s of the partner trading country.

Meanwhile, exporters, undertaking overseas shipments of goods and services through this mechanism, will be paid the export proceeds in Indian rupees from the balances in the designated Special Vostro account. This mechanism may enable Indian exporters to receive advance payment against exports from overseas importers in rupees.