The Reserve Bank of India (RBI) on Wednesday (April 7) extended National Electronic Funds Transfer (NEFT) and Real-Time Gross Settlement (RTGS) services beyond banks. RBI Governor Shaktikanta Das introduced that the services can now be utilized by non-bank fee operators as nicely. So far, solely banks had been allowed to make use of these (RTGS and NEFT) funds services.
Now, the issuers of Prepaid Payment Instrument (PPI), card networks, White label ATM operators and Trade Receivables Discounting System (TReDS) platforms can use these two modes.
As talked about, this variation has been made with a purpose to encourage participation of non-banks throughout fee methods.
RBI governor Shaktikanta Das stated, “Membership to the RBI-operated Centralised Payment Systems (CPSs) – RTGS and NEFT – is currently limited to banks, with a few exceptions. It is now proposed to enable non-bank payment system operators like Prepaid Payment Instrument (PPI) issuers, card networks, White label ATM operators and Trade Receivables Discounting System (TReDS) platforms regulated by the Reserve Bank, to take direct membership in CPSs. This facility is expected to minimise settlement risk in the financial system and enhance the reach of digital financial services to all user segments.”
“The main aim of this whole change is to encourage participation of non-banks across payment systems,” Das added.
An announcement by RBI acknowledged, “This facility is expected to minimise settlement risk in the financial system and enhance the reach of digital financial services to all user segments. These entities will, however, not be eligible for any liquidity facility from RBI to facilitate settlement of their transactions in these CPSs. Necessary instructions will be issued separately.”
On the opposite facet, RBI additionally elevated the utmost finish of day stability for fee banks to Rs 2 lakh. Earlier, the restrict was Rs 1 lakh. Payments banks have been asking a hike in deposit restrict for a very long time.
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