As per a report in Times of India, Rashtriya Ispat Nigam Ltd has adopted barter system to pay its vendors. A ferroalloys supplier to RINL VSP said that “The delay in payment started earlier this year, when bills that we had submitted for ferroalloys we supplied to VSP were delayed by several months, adding to our interest cost. When we approached VSP for payment we were told to take the payment either in the form of steel made by VSP. For example, if RINL-VSP has to pay a vendor INR 10 lakh for products delivered, then the company offers to give us finished steel worth INR 10 lakh. The vendor can then take the steel supply chit to the steel rerolling mill or a steel stockyard, and transfer the chit to it and get the material.”
ToI report quoted another vendor as saying that “Essentially, vendors like my company not only have to wait for months for payment, but since earlier this year we have had to take payment from RINL-VSP in kind, in the form of its products. My company has stopped supplying ferroalloys since March, and we have not participated in the tender process in the last two quarters because the barter system is causing us losses. The discount that vendors have to offer to steel re-rolling mills and steel stockyards is impacting the finances of vendors.”
According to RINL-VSP