NDB opens Indian rupee Nostro Account in Sri Lanka

National Development Bank PLC has recently opened an Indian rupee denominated Nostro Account with the Indian Bank. 

This marks a milestone in foreign payments and settlements in the country, where importers and exporters in the two countries are now able to carry out trade in Indian rupees. The ability to trade in Indian rupees brings in the dual benefits of promoting trade between India and Sri Lanka and eliminating the dependency on dollars for foreign trade.

India and Sri Lanka enjoy a vibrant and growing economic and commercial partnership, which has witnessed considerable expansion over the years. India has traditionally been among Sri Lanka’s largest trade partners and Sri Lanka remains among the largest trade partners of India in the SAARC. The India-Sri Lanka Free Trade Agreement (ISFTA) established in 2000 has further strengthened trade ties between the two countries spanning multiple areas such as infrastructure, connectivity, transportation, housing, health, livelihood and rehabilitation, education, and industrial development. Enhancements to the payments and settlements system within Sri Lanka through Indian rupee Nostro accounts will auger well for such thriving trade, and will also open up new markets for traders in both countries. 

This facilitation for importers and exporters by NDB is much welcomed by them particularly in the current context where Sri Lanka is facing a doller shortage as traders can now resort to Indian rupees for settlements. 

NDB maintains Nostro accounts in 17 currencies through strong a correspondent banking network across the world, affording a seamless foreign trade platform for its clientele. The Bank’s support to foreign traders are fully-fledged comprising a host of financial services such as specialised trade financing facilities, advisory support and a large number of partnerships in both Government and the private sector.