Page 105 - DMGT303_BANKING_AND_INSURANCE

Banking and Insurance

Notes electronically on the due date. Not only the investing public could get the payment on the due
date, but also the corporates could save substantially by not having to print paper instruments.
One can imagine the extent of savings from the fact that 36 million of such transactions were
routed through ECS during the year 2005-06. Similarly, the utility bodies are now in a position
to collect their bills through ECS right on the due date. Cash flow management is getting easier.
There were 16 million such transactions during 2004-05.
Third, extension of electronic funds transfer (EFT) facility by the banks has altered the money
transfer scenario. Using the EFT infrastructure laid by the Reserve Bank, commercial banks have
started offering same-day funds transfer facility to their customers. Bank customers at 15 major
centres can transfer funds to one another using this facility. A variant of EFT called Special-EFT
has been designed specially for the networked branches which facilitates funds transfer on the
same day within the closed group of computerized and networked branches located anywhere
in the country. Banks with Internet banking infrastructure are receiving requests from their
customers for EFT and executing the requests in a straight-through manner.
Fourth, launching of Real-Time Gross Settlement (RTGS) system by RBI has added a new
dimension to EFT scenario. Corporate bodies and other bank customers have now the option to
transfer funds to designated branches (around 9600 at present) instantaneously. According the
RTGS operating rules, if the credit cannot be applied, it should be returned within two hours-
meaning thereby that the maximum delay can be two hours.
Fifth, there has been a rapid growth in installation of ATMs in the country. Bank customers can
now access their accounts for withdrawal of cash, deposit of cash, balance enquiry, requisition of
cheque books, issue of stop-instruction etc. on 24X 7 basis. The ATM population is around 16,000
in the country at present and is increasing by a few hundreds each month.
Sixth, In the last three or four years there has been a phenomenal growth in use of payment cards
(debit and credit cards) as a payment medium in the country. As at the end of December 2004,
there were 4.33 crore payment cards in the country. The increasing use of cards is not only due
to the safety and convenience aspect but on account of retail consumer boom which has taken
place in the country.

Notes Cheque clearing system has vastly improved. Time taken for collecting a local
cheque has now reduced to two or three days.

5.8 Customer Grievances Redressal under Payment System

The customer may approach the bank concerned to redress the complaint. In case of lack of
response/satisfactory redressal by the bank, the customer may approach the Grievance Redressal
Cell in the local RBI office, if any. The customer may also approach the office of the Banking
Ombudsman for redressal of his complaint.
5.9 Payment Systems Vision Document (2009-2012)

I. Introduction

1.1 Safety, security, soundness and efficiency of the payment systems assume critical importance
from the angle of systemic stability. Smooth functioning of payment systems becomes
vitally important in the light of inter-linkages they have with other financial systems.
As indicated in the Report on “interdependencies of payment and settlement systems”

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