Defence Ministry approves HDFC, ICICI, & Axis to provide financial services in overseas procurement

The Defence Ministry today approved three Private Sector Banks (PSBs), namely HDFC Bank Ltd., ICICI Bank and Axis Bank, to provide financial services in overseas procurement.

In line with the further opening of allocation of Government business to Private Sector Banks by the Department of Financial Services, the Ministry of Defence has assigned three Private Sector Banks (PSBs) to provide the Letter of Credit and Direct Bank Transfer business for overseas procurement by the Ministry. MoUs in this connection have been signed with each of these three banks.

Till now, only authorised Public Sector Banks were utilised to provide these services to MoD. With this, three Private Banks have also been allowed for the first time to provide financial services for overseas procurement by the Ministry of Defence.

The selected banks may be allocated with LC business of Rs 2,000 crore, each on the capital and revenue side, for a period of one year on a concurrent basis. The performance of these banks will be monitored regularly so as to take necessary further action as required.