YES bank, UCO Bank in talks with Russia to finalise payment mechanism: Official

New Delhi, Oct 20 (KNN) Indian lenders UCO Bank and Yes Bank are joining hands with Russian banks over a payment mechanism for trade between the two countries, a senior government official said on Thursday.

According a report by the Reuters, the large lenders are reluctant to process direct rupee trade transactions with Russia for fear of becoming the target of sanctions over the invasion of Ukraine, and New Delhi is counting on smaller banks like UCO and Yes.

"Few of the Russian banks are joining hands with UCO Bank and Yes Bank. It will be primarily rupee-basis trade, could be rupee-rouble or could be rupee-riyal," the official, who did not want to be named, told reporters in New Delhi.

"Banks are discussing the currency pair for the payment mechanism and the options include the Indian rupee paired with the Russian rouble or Saudi Arabia's riyal," the official said.

The official did not elaborate on how the rupee-riyal mechanism will be designed to settle trade between New Delhi and Moscow.  (KNN Bureau)