Copyright indiatimes
The Reserve Bank of India (RBI) on Wednesday issued a draft circular proposing measures to accelerate cross-border inward remittances. The central bank has suggested that banks credit inward payments received during foreign exchange market hours to beneficiaries’ accounts on the same business day.The draft also proposes that banks reconcile and confirm credits in their nostro accounts either on a near real-time basis or at intervals not exceeding thirty minutes. Once finalised, the guidelines would require banks to notify customers immediately upon receipt of cross-border inward payment messages. Messages received after business hours must be communicated at the start of the next working day.“It is observed that several banks rely upon end-of-day statements of the nostro account for confirming and reconciling receipts, resulting in delayed credit,” the RBI noted. To expedite the process, banks have been advised to adopt near real-time reconciliation or periodic reconciliation within a maximum interval of thirty minutes.The RBI has also proposed that banks implement straight-through processing (STP) for crediting inward remittances to resident individual accounts and provide customers with digital interfaces to facilitate foreign exchange transactions — including document submission and transaction monitoring. The directions will take effect six months after the final circular is issued.ET had reported last month that international payments platform SWIFT was in discussions with the finance ministry and the RBI to help banks speed up cross-border settlements. Currently, less than 8–10% of inward remittances in India are credited to beneficiary accounts within an hour, compared with about 75% in the US — even though 90% of all cross-border payments processed via SWIFT reach the beneficiary bank within an hour.Live EventsDelays often occur because several Indian banks contact recipients for confirmation before crediting accounts or reverify account details. In many cases, batch processing in back-office systems further slows settlement. Contrary to popular belief, most international payments are not routed through long chains of intermediaries — SWIFT data shows that 86% of transactions are completed directly or through a single intermediary.Add as a Reliable and Trusted News Source Add Now! (You can now subscribe to our Economic Times WhatsApp channel) Read More News onRBIforeign exchange transactionsinward paymentsremittance processingSWIFT paymentsdigital interfacesbanking regulations (Catch all the Business News, Breaking News and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online....moreless (You can now subscribe to our Economic Times WhatsApp channel)Read More News onRBIforeign exchange transactionsinward paymentsremittance processingSWIFT paymentsdigital interfacesbanking regulations(Catch all the Business News, Breaking News and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online....moreless
