Copyright informalnewz
There’s some good news for millions of Indians working abroad. They no longer have to wait days for their money to reach their families. The Reserve Bank of India (RBI) has issued a new proposal. There’s some big news for millions of Indians working abroad. They no longer have to wait hours or days for remittances to reach their families. The Reserve Bank of India (RBI) has issued a new proposal that will make remittances from abroad faster and easier than ever before, depositing them into beneficiaries’ accounts in India. This move aims to bring India’s banking system in line with global payments standards. The RBI has issued this draft guideline under its Payments Vision 2025 and G20 Roadmap. It states that banks receiving payments from abroad must credit customers’ accounts on the same business day for funds received during foreign exchange market hours. If funds arrive after market hours, they must be transferred on the next working day. Currently, only 8-10% of foreign remittances in India reach the beneficiary’s account within an hour, compared to 75% in countries like the US. This move by the RBI will make India’s payment system faster and more reliable internationally. Why are there delays? Delays often occur because Indian banks verify payments through the end-of-day statements of foreign banks’ nostro accounts. The funds first reach these accounts and are then transferred to the customer’s Indian account. Delays in this process and manual checking lead to delays in receiving funds. Now, the RBI has recommended that banks reconcile their nostro accounts in “near real-time,” or at most every 30 minutes. Furthermore, the RBI has directed banks to use a “straight-through automated system” to reduce human error and delays. Additionally, banks should provide their customers with a website or app to view the status of remittances in real time. RBI’s Clear Order The RBI has clarified that banks should inform customers immediately of receipts. If payments arrive after market hours, the notification should be provided by the beginning of the next working day. The RBI has sought feedback on this draft from banks and other stakeholders by November 19th. These new rules will be implemented six months after the final circular is issued. Read More: Weather Update: Heavy rains expected in large parts of North India, including Uttar Pradesh, Bihar and Delhi; weather department issues alert
