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‘Now it’s only beginning, but we see huge opportunity for digital currency for all settlements between the countries,’ says Sberbank Chief Executive Officer Herman Gref.
Sberbank CEO Herman Gref said “we need to bring more Indian exports and more opportunities to the Russian market and this is our goal”.
Russia’s central bank is working with the Reserve Bank of India (RBI) on a mechanism that could enable the use of digital currencies for bilateral trade settlements, Sberbank Chief Executive Officer Herman Gref said on Friday, according to a Bloomberg report.
The initiative is at an early stage but could eventually make payments between the two countries faster and more efficient, Gref said while speaking to reporters in New Delhi, where India is hosting the annual BRICS summit. Sberbank is Russia’s biggest lender.
“Now it’s only beginning, but we see huge opportunity for digital currency for all settlements between the countries,” Gref said. “The Russian central bank and the central bank of India are working on this very precisely and we have tried to support them because we need this kind of instrument.”
Russia began rolling out its central bank digital currency, the digital ruble, on September 1 through systemically important banks, including state-controlled Sberbank. India launched its digital rupee pilot in 2022.
The Kremlin had said on Thursday that Russia would discuss the use of digital currencies for trade settlements with BRICS members and partner countries at the summit in New Delhi. India has also backed the use of central bank digital currencies for bilateral trade and cross-border payments.
BRICS payment systems
The digital currency discussions form part of wider BRICS efforts to improve cross-border payment connectivity and reduce transaction frictions.
BRICS countries have been exploring ways to link their payment systems, potentially reducing dependence on the SWIFT network. The issue has particular significance for Russia, whose major banks were cut off from the West-dominated SWIFT following the country’s invasion of Ukraine in 2022.
With India chairing BRICS this year, Prime Minister Narendra Modi favors using central bank digital currencies to settle bilateral trade between members and cross-border payments, without positioning the initiative as a challenge to the dollar.
Russia says rupee surplus no longer a major hurdle
Gref also said the large rupee balances accumulated by Russian companies in vostro accounts were no longer a significant obstacle to bilateral trade.
Russia built up billions of dollars worth of rupee balances after India sharply increased purchases of Russian oil following the invasion of Ukraine. The imbalance emerged because India imports substantially more from Russia than it exports to the country.
“Now it’s not the problem in our trade and we try to increase the trade between the countries,” Gref said, adding that Russian companies had found “the right ways to utilise all the rupees.”
Some of the surplus rupees have been invested in Indian government securities, he said, without giving details on the amount.
The RBI has allowed rupee balances held in vostro accounts to be used for permitted investments in India as well as for future payments for goods and services.
India-Russia trade imbalance
Bilateral trade between India and Russia totalled nearly $60 billion in India’s fiscal year 2026, with Russian oil accounting for a large share of India’s imports, Bloomberg reported.
The two countries have set a target of increasing bilateral trade to $100 billion by the end of the decade. But the trade remains heavily skewed towards Russia.
“We need to bring more Indian exports and more opportunities to the Russian market and this is our goal,” Gref said, referring to a trade imbalance of more than $50 billion.
A digital settlement mechanism could therefore become part of a broader effort by the two countries to facilitate payments while expanding trade beyond India’s heavy dependence on Russian energy imports.
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Ask News18The central banks of India and Russia are working on a mechanism to use digital currencies for bilateral trade settlements. This initiative, which is in its early stages, aims to make cross-border payments between the two countries faster and more efficient.
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