Soon you may be able to tip in rupees in Thailand! RBI, government look to popularise use of Indian currency – Times of India

The route of Rs

Payment in Rs Thailand Similarly? Imagine the possibility of using Indian rupees for a tip at a beachside bar in Pattaya or a luxurious spa in Bangkok. This scenario could become a reality if India successfully negotiates a currency agreement with Thailand.
Government of India and Reserve Bank of India (RBI) is exploring possibilities to popularize it. In Thailand Rswhich is a popular destination for Indian tourists and businesses. The central bank has requested banks to provide their information and expectations regarding transactions involving Thailand, as authorized dealer banks have insight into travelers’ destinations, international card spending and trade receipts. .
A senior banker told ET, “They have sought our opinion. I think there is a plan for some rupee arrangement with Thailand. It is in the early stages, as far as we can make out”.

The route of Rs

The route of Rs

India has been trying to internationalize the rupee in recent years, with limited success. Internationalization involves the use and holding of local currency outside India’s borders, not only for transactions between residents and non-residents but also between residents of countries other than India.
By mid-2023, India has a Exchange deal With the United Arab Emirates (UAE), allows exporters and importers of both countries to invoice and pay in their respective local currencies to settle trade.
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Central banks play an important role in currency management by acting as a backstop, exchanging foreign currency for domestic currency. This creates confidence in individuals and institutions to accept foreign currency from buyers of goods and services.
“We don’t know if India and Thailand are considering an exchange agreement, but given the extent of travel and trade, it is possible,” said a person familiar with the matter.
Indians comprise the fourth largest group of tourists to Thailand, with Bangkok overtaking Dubai as the outbound travel destination for Indians following visa relaxation.
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Promoting the local currency through bilateral exchange deals with various countries was a strategy used by China to gain wider acceptance of the yuan. “Once the two-way swap is in place, it can gradually help create a market for foreign currency. India can follow a similar path,” another person said. said Increased overseas acceptance of the local currency could potentially reduce demand for standard reserve currencies such as the dollar and euro.
Bilateral deals from the special Vostro account allowed by the RBI to facilitate trade settlements with Russia in rupees after the start of the Ukraine war in February 2022 could also yield better results. Many bankers and economists believe that the RBI’s market interventions to maintain the stability of the rupee are aimed at its acceptance as a less volatile unit for cross-border trade payments.

Business news,Thailand,Exchange deal,In Thailand Rs,Reserve Bank of India,Indian Rupee,Currency trading

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