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Showing posts with label Discussion Paper. Show all posts
Showing posts with label Discussion Paper. Show all posts

Thursday, August 18, 2022

RBI Discussion Paper on Charges in Payment Systems - Sample feedback for RTGS Questions

 RBI Discussion Paper on Charges in Payment Systems - Sample feedback for RTGS Questions

          The window to provide feedback to Reserve Bank of India for its ‘Discussion Paper on Charges in Payment Systems’, has started.

          The last date to provide feedback is 3rd October 2022.

          Today’s blog talks about Sample feedback for RTGS Questions.   

          There are 3 specific questions regarding RTGS.

 


Para No 8.2 Real Time Gross Settlement (RTGS) System

Page No 8 and 9

8.2.6. Questions for Feedback

 

i.(S1) Should RBI review the policy of not levying charges on members for RTGS transactions?

Sample Feedback __ i.(S1)

Yes, RBI should review the policy of not levying charges on members for RTGS transactions.

Option 1 – Fixed – EX: INR 3/- per customer outward transaction

Option 2 – Variable – Ex INR 4/- per customer outward transaction up to 25,000/- customer outward transactions per day

INR 2/- per customer outward transaction above 25,000 and up to 50,000/- customer outward transactions per day

INR 1/- per customer outward transaction above 50,000 and up to 75,000/- customer outward transactions per day

Nil for transactions above 75,000 transactions per day

As all banks may not high RTGS outward customer transactions, Banks can choose between Option 1 and Option 2

 

 

ii.(S2) Should the time-variable charges be re-introduced?

Sample Feedback __ ii.(S2)

Yes, the time-variable charges should be re-introduced but in a reverse method

EG: All Days

12:01 to 13:00 Hours - INR 20/- per transaction credited to customer

13:01 to 18:00 Hours - INR 10/- per transaction credited to customer

18:01 to 23:59 Hours - Nil

The exceptions not exceeding 5 may be approved by the respective Bank’s Board.

 

iii.(S3) For RTGS transactions, should RBI prescribe the charges that can be levied on

customers by members, or should they be market driven?

 

Sample Feedback __ iii.(S3)  A) RBI should prescribe the charges that can be levied on customers by members. There can be a maximum gap with an auto-increase of the same say by 5% with rounding off to the next rupee

EG: Year 1 – INR25/-

Year 2 – Increase of 5% 25 + 1.25 = 26/-

Year 3 – Increase of 5% 26 + 1.30 = 27/-

And so on,

B) The credit window for Inward customers transactions may be reduced to 15 minutes from the present 30 minutes, with minimum exceptions. The exceptions not exceeding 5 may be approved by the respective Bank’s Board.

C) The maximum transmission time for outward customer transactions from the debit moment, may be introduced. If this transmission time is crossed, banks may be required to compensate the customers. The exceptions not exceeding 5 may be approved by the respective Bank’s Board.

EG: Customers Account, by whatever mode is debited at 11.30am on 17/08/2022. The beneficiary should receive the funds with 13.30pm on 17/08/2022. The window between the actual debit and the actual credit may be finalised by mutual consent of all RTGS participants.

 

D) As on today, in case, it is not possible to credit the funds to the beneficiary’s account for any reason e.g. account does not exist, account frozen, etc., funds shall be returned to the originating member within one hour of receipt of the payment at the Member Interface of the recipient member, subject to availability of RTGS.

The 'One Hour' window may reduced to '30 Minutes'

E) The minimum amount for RTGS Customer Transactions may be increased from the present INR2lacs to INR2.50lacs, with auto increase of say INR25,000/- every calendar year

 

Additional Reading

RBI seeks responses to its 40 Questions - Discussion Paper on Charges in Payment Systems @ https://prashantnepayments.blogspot.com/2022/08/rbi-seeks-responses-to-its-40-questions.html

RBI FAQs on RTGS @ https://m.rbi.org.in/scripts/FAQView.aspx?Id=65

Time-varying charges for transactions in RTGS @ https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=11564&Mode=0

 

Disclaimer: These are my personal views only. The bottom line is Safe ePayments. Nothing More – Nothing Less.

As of now this is only sample feedback. The actual feedback will be provided to Reserve Bank of India via email.


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