RBI Drops Prior Approval for Special Rupee Vostro Accounts
Why in the news
RBI changed the SRVA procedure to ease compliance for banks.
Key facts
- Prior RBI approval no longer required.
- Move supports rupee-based trade settlement.
About SRVAs
- INR-denominated accounts held by overseas banks with Indian AD banks.
- Used to settle exports and imports in rupees.
- Introduced under the 2022 RBI framework.
Significance
- Easier cross-border trade; rupee internationalisation.
- Stronger ties with nations facing dollar liquidity issues.
Exam angle
- Full form: Special Rupee Vostro Account.
- Who opens it: AD banks for foreign correspondent banks.