Wednesday, April 21, 2021
No menu items!
HomeBanksRTGS, NEFT money transfer facilities extended beyond banks: RBI chief Shaktikanta D...

RTGS, NEFT money transfer facilities extended beyond banks: RBI chief Shaktikanta D…

Reserve Bank of India (RBI) on Wednesday extended the National Electronic Funds Transfer (NEFT) and Real-Time Gross Settlement (RTGS) facilities to non-bank payment system operators. Till now, only banks were allowed to use RTGS and NEFT payments facilities. Now, Prepaid Payment Instrument (PPI) issuers, card networks, White label ATM operators and Trade Receivables Discounting System (TReDS) platforms can use NEFT and RTGS modes.

“Membership to the RBI-operated Centralised Payment Systems (CPSs) – RTGS and NEFT – is currently limited to banks, with a few exceptions. It is now proposed to enable non-bank payment system operators like Prepaid Payment Instrument (PPI) issuers, card networks, White label ATM operators and Trade Receivables Discounting System (TReDS) platforms regulated by the Reserve Bank, to take direct membership in CPSs. This facility is expected to minimise settlement risk in the financial system and enhance the reach of digital financial services to all user segments,” RBI governor Shaktikanta Das said.

The aim is to encourage participation of non-banks across payment systems, the central bank said. “This facility is expected to minimise settlement risk in the financial system and enhance the reach of digital financial services to all user segments. These entities will, however, not be eligible for any liquidity facility from the Reserve Bank to facilitate settlement of their transactions in these CPSs. Necessary instructions will be issued separately,” a statement by RBI mentioned.

“This is a very positive development by RBI and will give a big impetus to online payments and the digitisation of the Indian economy. 24 x 7 enabling of NEFT, RTGS etc gives a big boost to commerce which will have a multiplier effect on our economic growth and GDP,” said Abhishek Soni, chief executive officer and co-founder of Upwards.

“Alongside, it also strengthens India’s position globally as the flagbearer of the most advanced digital payments and fastest settlement cycles after UPI,” he further added.

The central bank also increased the maximum end of day balance for payment banks to 2 lakh. Earlier, the limit was 1 lakh. Payments banks have been asking a hike in deposit limit for a long time.

Reserve Bank of India on Wednesday kept interest rates unchanged and maintained an accommodative stance. The decision came amid a renewed threat to growth due to the resurgence of coronavirus cases in the country. The repo rate has been maintained at 4% and reverse repo rate at 3.35%.

Subscribe to Mint Newsletters

* Enter a valid email

* Thank you for subscribing to our newsletter.

Source link

banknewsnowhttps://www.banknewsnow.com
Founder and CEO of the premier banking news informational website for the banking/financial industry, and applicants seeking careers exclusively in the finance field.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -

Most Popular

Recent Comments

    Skip to toolbar