01/05/2012 -RTGS/NEFT are open

       On 01/05/2012, though majority of the Banks Branches  are closed, RTGS/NEFT will be open.

       As is the normal practices, Bank Customers whose local branches are closed, can access RTGS/NEFT through their Bank's internet banking sites. Of course, the customers have to be registered for Net Banking of their respective Banks.

Basava Jayanthi – 24/04/2012 – Holiday Under NI Act 1881 in Karnataka

However, it is to be noted that only Banks in Karnataka are closed on 24/04/2012. Banks in other parts of India are open.

Bank customers in Karnataka, can carry out their routine banking transactions I.e withdraw money through ATM, do physical shopping and pay via Debit/Credit Cards, do online shopping with Debit/Credit Cards

Basava Jayanthi marks the birthday of Basavanna, the founder of Lingayat faith, practiced mostly in Karanataka.

Basaveshwara belonged to the 12^th century, and was a great thinker, social reformer, saint and religious teacher.

Printing of MICR Code and IFSC Code on Passbook/Statement of Account

RBI, DPSS has announced another customer-friendly initiative. It has advised all Chairman and Managing Director / Chief Executive Officer of all banks participating in RTGS, NEFT and NECS to make arrangements for Printing of MICR Code and IFSC Code on Passbook/Statement of Account

The relevant RBI notification can be accessed here.

The display of MICR Code and IFSC Code is presently available only on the Cheque leaf of the account holder.

MICR code is necessary for all Electronic Clearing Service (ECS – Credit and Debit) transactions.

Similarly, the IFSC code is a pre-requisite for NEFT and RTGS transactions.

To improve customer efficiency levels and to ensure a high success rate for ePayments, RBI has advised Banks to take necessary steps to provide this information as indicated above in all passbook / statement of account to their account holders.

The respective Banks have to furnish to RBI, an action taken report within 15 days of receipt of this circular.

3 immediate benefits of this RBI Notification.

1. Bank customers have an additional authenticated source of MICR/IFSC Code.
2. Ease in sharing MICR/IFS Code with any remitters.
3. Increase in success rate for ePayments.

National Electronic Funds Transfer (NEFT) - Acceptance of NEFT inward for credit to Loan Accounts

Reserve Bank of India, vide Notification No.RBI/2011-2012/496, DPSS (CO) EPPD No.1894/04.03.01/2011-12, has advised all Banks to accept Loan Credits via NEFT also.

This advisory was necessitated as RBI had received some complaints from customers regarding non-acceptance of NEFT for credit to loan accounts, which was causing inconvenience to the Loan Customers.

As the Banks were willingly taking ECS (Dr) as one of the modes for the repayment and NEFT also being an electronic transfer mode, Banks have been advised to allow the customers to choose NEFT also as one of the electronic modes of making payment towards loan EMIs / repayments etc.

5 reasons as to why do Banks not prefer NEFT Credits to Loan Accounts?

1. Loan Accounts are not part of the Core Banking System, hence, real-time verification of Loan Account Number and customers' name is delayed.

2. Customers might pre-pay the Loan which might not be preferred by Bankers.

3. The actual credit to Loan Accounts might take 2/3 days, in between if the ECS transaction is generated and sent to the Destination Bank, the customers account in the other bank might be debited twice for the same installment. This leads to subsequent customer complaints at a later date.

4. Customers might remit a lesser amount than the Monthly Installment amount, leading to overdue interest being charged in the Loan Accounts. If this is not properly communicated to the Loan customer, there are high chances of customer complaints.

5. If there are multiple credits in a single month, the EMI (Equated Monthly Calculation), will be lopsided, with no clarity.

7 tips to ensure that your NEFT credits to your Loan Account are hassle-free: -

a) Activate your Loan Account in the net banking module.

b) Add the Loan Account as a Payee in your net banking module, funds remitting bank account.

100. Do a test transfer of say Rs10/- and verify the credit in your Loan Account.

d) This will also enable you to know the Lead time between the actual NEFT transfer and the actual Loan Account, which will be useful when transferring the actual payment

e) Once the amount is transferred, inform the details to the customer service email id of the Loan Bank.

f) Verify the credit in your loan account after couple of days.

g) In case of any doubt, immediately mail/lodge query with the respective Loan Bank.

107+ Banks are on NEFT platform, with 2,16+crs transactions being put through the same.

Well, apart from Banks, there are other financial institutions which disburse Loans and collect the repayments through ECS(DR). Trust NEFT credits to such Loan Accounts will also be enabled soon.

IMPS – March 2012 Volumes

It was nice to see the jump in IMPS (Interbank Mobile Payment Service) volumes for March 2012, as compared to February 2012.

The Customers as well as the respective IMPS member banks seem to slowly getting a grip on the process flow.

All the member banks have great information about the IMPS process flow on their websites.

Such information increases the confidence levels of the customers to try out IMPS for their ePayments.

During April 1^st week, as there quite a few Bank Holidays, customers must have been greatly benefited by IMPS.

A focused marketing approach by the member banks, will increase the recall levels of IMPS, and nudge them towards IMPS.

NPCI (National Payments Corporation of India) has made a beginning by conceptualizing the IMPS Video and displaying on its website.

6 benefits of a focused marketing campaign:

1. Increase in customer awareness.
2. Increase in brand recall.
3. Encourage customers to enquire with their respective Banks about the IMPS facility.
4. Encourage customers to shift part of their traditional Payments to IMPS.
5. Effective ROI for Banks for their investment in the IMPS infrastructure.
6. Increase in disputed transactions, which will enable NPCI and the Banks to fine-tune the process flow.

In the near future, NPCI might launch a marketing campaign for IMPS.