DFCC Bank has signed a Master Trade Loan Agreement with the Export-Import Bank of India — the first such agreement between India Exim Bank and a Sri Lankan bank under the Indian institution’s Trade Assistance Programme.
The agreement was signed on 22 September, Hiru News reported, and is intended to support trade between the two countries.
Who signed
The document was signed by Thimal Perera, Director and Chief Executive Officer of DFCC Bank; Prins Perera, Senior Vice President for Treasury and Investment Banking at DFCC; and Sailesh Prasad, General Manager of India Exim Bank. The signing took place in the presence of Devika Lal, Counsellor for Economic and Commercial Affairs at the High Commission of India in Colombo.
What the facility does
Under the Trade Assistance Programme, India Exim Bank provides credit enhancement for trade instruments. That allows participating banks to support cross-border transactions with Indian markets in cases where trade lines would otherwise be limited.
For DFCC, the agreement opens access to dedicated trade financing through India Exim Bank, which the bank says will let it offer competitive short-term funding to Sri Lankan businesses trading with Indian counterparties, according to the Colombo Gazette.
The arrangement is a framework rather than a committed sum: it establishes the terms under which DFCC can draw trade-related funding, with individual transactions still subject to assessment, approval and applicable conditions. Neither bank has disclosed a facility limit.
Trade finance addresses the gap between the movement of goods and the timing of payment — the period in which an exporter has shipped but not yet been paid, and an importer has committed but not yet received. The new framework gives DFCC an additional channel for financing eligible trade linked to the two countries.
Both banks describe the facility as likely to support higher bilateral trade by improving access to trade finance. For DFCC, it forms part of a wider effort to expand its trade finance capability and deepen financial links with India.
