United Bank of India – 'The Tea Bank of India', enter the world of IMPS

In August 2011, United Bank of India, launched its mobile banking application. This was the forerunner for launching IMPS for it's customers.

In July 2012, United Bank of India formally launched the IMPS facility for its customers.

UBI is popularly known as 'Tea Bank of India', as it has an age old association with the Indian Tea Industry. UBI is the largest lender to the Indian Tea Industry.

Though United Bank of India, came into existence in 1950, its original roots go back to 1914. United Bank of India, is an amalgamation of 4 bankz viz. Comilla Banking Corporation Ltd. (1914), Bengal Central Bank Ltd. (1918), Comilla Union Bank Ltd. (1922) and Hooghly Bank Ltd. (1932) (which were established in the years indicated in brackets after the names).

UBI is the Lead Bank in 30 districts of West Bengal, Assam, Manipur and Tripura. It also dons the mantle of Convener of the State Level Bankers' Committees (SLBC) for the States of West Bengal and Tripura.

UBI concentrated in spreading the banking services more particularly in Eastern and North-Eastern India. UBI has sponsored 4 Regional Rural Banks (RRB) one each in West Bengal, Assam, Manipur and Tripura. These four RRBs together have over 1000 branches.

UBI has spread the banking services to the people living in the not easily accessible areas of the Sunderbans in West Bengal, UBI had established two floating mobile branches on motor launches which moved from island to island on different days of the week. The floating mobile branches were discontinued with the opening of full-fledged branches at the centers which were being served by the floating mobile branches.

On the way, UNI in 1973 UBI acquired Hindusthan Mercantile Bank and in 1976 UBI acquired Narang Bank of India.

With the introduction of IMPS, the staff of Tea Estates will be the major beneficiaries, as they can now quickly,safely remit/receive money. 

New NEFT Service Charges w.e.f 01/08/2012 – Be ready for less!!

NEFT was introduced to India's banking customers in 2005. Over the years, the volumes have zoomed up with many of our countrymen enjoying the speed of Safe ePayments.

Way back in 2008, Reserve Bank of India, rationalized the Service Charges on Electronic Payment Products.

With the increasing volumes and keeping in mind the demand from the customers, RBI today, has announced fresh rationalization of NEFT service charges.

The RBI notification number is RBI/2012-13/131 DPSS CO (EPPD) /98/04.03.01/2012-13, and can be viewed here.

Value Band	Maximum Charges (exclusive of service tax)
Amounts up to `10,000/-	`2.50/-
Amounts from `10,001/- to `1 lakh	`5/-
Amounts above `1 lakh up to `2 lakh	`15/-
Amounts above `2 lakh	`25/-

It is observed few banks are charging customers for NEFT transactions via their Net banking sites, and the majority of the transactions are below `10,000/-.

Hence, to encourage small ticket transactions, RBI has introduced a new slab of upto `10,000/-

Be Careful – RTGS/NEFT closed for a long weekend.

RTGS/NEFT will be closed on 02/07/2012, as on July 2^nd RBI is closed due to its Annual Closing of Accounts.

July 1^st, 2012 is a Sunday, so RTGS/NEFT will be closed continuously for 2days. Being the beginning of the month, there will be huge volumes on 3^rd July. It is advisable to plan any transfer via RTGS/NEFT carefully, for the next week or so.

Transactions that settle on T+0 basis cannot be put through on July 2, but markets participants may be able to do transactions that settle other than on T+0 basis.

Well, IMPS(Interbank Mobile Payment Service) will be open and Bank customers will be able to transfer funds via the IMPS mode. Hm, the surge in volumes will depend on the publicity around IMPS.

Central Bank of India to launch RuPay Cards

The RUPAY Card network has added one more member, with Central Bank of India inking an agreement with National Payments Corporation of India (NPCI) for issuance of RuPay cards.

To make the best use of this agreement, Central Bank of India, tweaking all its EDC Machines to be RuPay compliant. With the above feature, the bank will be in a position to issue RuPay cards as well as make payment of all RuPay cards issued by other banks in the country.

The major observation by Central Bank of India, is that the charges currently levied by RuPay are almost at par with others. NPCI has assured that shortly they will bring down these charges.

NPCI is also encouraging banks to issue RuPay cards for Financial Inclusion and Kisan Credit Card.

Central Bank of India, was established in 1911, and has the distinction of being the first Indian Commercial Bank wholly owned and managed by Indians. Central Bank of India, was the dream of Sir Sorabji Pochkhanawala, founder of the Bank.

The Bank recently celebrated its 100 years of existence.

Over the years, various innovative schemes were launched by the bank. The most noteworthy was the launch of an Exclusive Ladies Department to cater to the Bank's women clientele, that too in the year 1924.

Tata Industrial Bank founded by Shri.J.R.D Tata was acquired by Central Bank of India, in 1923

A magnificent book on Bank's History was released as part of its centennial celebrations.

Amendments to Policy Guidelines for issuance and operation of Prepaid Payment Instruments in India

As the concept of Prepaid Payment Instruments are becoming popular in our country, RBI to further encourage Safe ePayments has considered it necessary to announce two amendments.

The following are two amendments announced on 12/06/2012

1. The limit of Rs 1000/- for semi-closed prepaid payment Instrument that can be issued under Para 6.4 (i) of guidelines dated April 27, 2009 has been raised to Rs 2000/-.

The instruments can be issued against any identity document furnished by the customer as long as the issuer reports the annual transfer/suspicious transactions. Further, RBI has also specified that only one active instrument should be issued by the issuer to the same holder I.e multiple instruments should not be issued.

Another important amendment is on the belief that the full KYC of the customer has been done by the provider of such services.

2. The issue of semi-closed prepaid payment instrument upto Rs 10,000 without separate KYC being conducted by the issuer, for payment of utility bills/ essential services/ air and train travel under Para 6.4 (iii) was permitted on the premise that full KYC of the customer is already being done by the provider of such services. The control exercised by the issuer has been on the acceptance side, ie. utility of the card for the specific purpose at the specific merchant. Based on this rationale, it has been decided to redefine the merchant categories under Para 6.4 (iii).

The Merchant categories now included under Para 6.4(iii) are :-

a) Utility providers/Essential service providers viz electricity bills, water bills, telephone/mobile phone bills, insurance premium, cooking gas payments, rental for Internet/Broadband Connections, Cable/DTH subscriptions and Citizen Services by Government or Government bodies. .

b) Air and Train travel tickets

c) recurring payment of college fees

d) recurring payment of school fees

e) government taxes upto a limit of Rs10,000/-

The concept of Prepaid instruments in India was first thought of in the paragraph 151 of ‘Annual Policy Statement for 2009 – 2010’

Semi-closed system payment instruments are redeemable at a group of clearly identified merchant locations or establishments which contract specifically with the issuer to accept the payment instrument. No cash withdrawals are permitted under the semi-closed payments instrument options.

A Payment Instrument in brief can said to be instruments which permit transactions for value between a payer and beneficiary by which the payer discharges the payment obligation of the beneficiary. The payment mode can be pre-paid, post-paid(eg mobile connections) or immediate discharge.

A simple defintion of Pre-Paid Instrument is any payment instrument which permit transactions for value stored in them. The most popular prepaid instruments in India are the prepaid mobile vouchers. As the prepaid mobile vouches gained popularity, the concept was extended to other services.

Prepaid instruments aim to reduce the usage of cash and also enable ePayments through internet/mobile shopping.

Popular types of Prepaid payment instruments.

1) Closed System Payment Instruments: These are payment instruments generally issued by business establishments for use at their respective establishment only. These instruments do not permit cash withdrawal or redemption. The best example could be canteen tokens issued by business establishments.

2. Open System Payment Instruments: These are payment instruments which can be used

for purchase of goods and services and also permit cash withdrawal at ATMs; The best example is the Bank Debit Card.

3. Semi‐closed System Payment Instruments: These are payment instruments which are

redeemable at a group of clearly identified merchant locations/ establishments which contract specifically with the issuer to accept the payment instrument. These instruments do not permit cash withdrawal or redemption by the holder; The best example are the mobile recharge vouchers.

4. Semi‐open System Payment Instruments: These are payment instruments which can be

used for purchase of goods and services at any card accepting merchant locations (Point

of sale terminals). These instruments do not permit cash withdrawal or redemption by

the holder.

Normally, cross border transactions are not permissible on these instruments. However, only entities which have permissions under FEMA can issue cross border transaction enabled prepaid instruments.

In India, of the above 4, RBI has permitted the issuance of the following three types of instruments:

(i) Closed system payment instruments Examples of such instruments are gift vouchers issued by certain merchant establishments and telephone calling cards. Mobile prepaid value may also be considered as a closed‐system prepaid payment instrument, though they can be used for availing of additional value‐added services.

(ii) Semi‐closed system payment instruments. E.g. prepaid cards which are redeemable at a group of establishments associated with a particular shopping mall, tourist resorts, or at establishments and service providers listed out by the issuer; and

(iii) Open system payment instruments ‐ only banks are permitted to issue this type of

instruments.

Previous Circulars on Pre-Paid Instruments:

RBI / 2008-09 / 458 DPSS. CO. PD. No. 1873/02.14.06/2008-09 dated April 27, 2009,

RBI / 2010-11 / 261 DPSS. CO. No. 1041 / 02.14.006 / 2010-2011 dated November 04, 2010

RBI / 2011-12 / 144 DPSS. CO. PD. No. 225/02.14.006/2011-12 dated August 04, 2011