1 min read.Updated: 12 Apr 2021, 03:25 PM IST Written By Anulekha Ray
'Member banks may inform their customers to plan their payment operations accordingly,' RBI said
The National Electronic Funds Transfer (NEFT) system will continue to be operational as usual during this period, RBI said
Reserve Bank of India (RBI) on Monday said that Real-Time Gross Settlement (RTGS) facility will not be be available for at least 14 hours on 18 April. "A technical upgrade of RTGS, targetted to enhance resilience & to further improve disaster recovery time of RTGS system, is scheduled after close of biz of Apr 17. Accordingly, RTGS service won't be available from 00:00 hrs to 14.00 hrs on Sunday, 18 April," the central bank said in a statement.
"Member banks may inform their customers to plan their payment operations accordingly," it further added. "RTGS Members will continue to receive event update(s) through system broadcasts," the central bank mentioned.
The National Electronic Funds Transfer (NEFT) system will continue to be operational as usual during this period, RBI said.
Last week, the central bank extended the NEFT and RTGS facilities to non-bank payment system operators. Till now, only banks were allowed to use RTGS and NEFT payments facilities. Now, Prepaid Payment Instrument (PPI) issuers, card networks, White label ATM operators and Trade Receivables Discounting System (TReDS) platforms can use NEFT and RTGS modes.
The aim is to encourage participation of non-banks across payment systems, RBI said. "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 the Reserve Bank to facilitate settlement of their transactions in these CPSs. Necessary instructions will be issued separately," a statement by banking regulator mentioned.
''The RBI announcement to extend the NEFT and RTGS facilities to digital payments intermediaries is a positive move. This will be a paradigm-changing development for the digital fintech landscape. It will help in further penetration of digital payments and increase digital transactions within the payment space," said Zafar Imam, chief executive officer, Finshell.
"Also, since fintech platforms tend to bring more custom-made solutions for users than banks, it will pave the way for a smoother user experience and make fintech platforms a force to reckon with alongside traditional banks,'' he futher added.