Providers of renewable energy will be able to access letters of credit (L/Cs) faster under a new arrangement between a specialist financial institution and Indian banks.

PTC India Financial Services Limited (PFS), which specialises in renewable energy financing, has said it has entered into arrangements with several Indian banks to make a streamlined L/C service available for renewable energy providers.

Faster decisions

PFS says it has provided letters of comfort to banks that will issue the L/Cs. This means those banks will be able to make faster decisions on L/C issuance.

Currently, it takes between three and five months for renewable energy companies to obtain L/Cs according to PFS.

It says that under the new arrangement, L/Cs can be opened in a much shorter time on case-to-case basis.

Additional benefits

Another advantage is that currently, renewable energy companies have to approach several banks and negotiate with each of them the costs of L/C issuance.

Under the new arrangement, companies will be able to approach PFS on a one-stop-shop basis.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.