WORLD TRADE ORGANIZATION

DISPUTE SETTLEMENT IN CASE OF

GATT

A CURIOUS CASE OF APPLES

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Final Decision
 CONTENTS
• PAYMENT SYSTEM’S VISION
• THE INDIAN PAYMENT SYSTEM INFRASTRUCTURE
• EFT AND SEFT
• EFT PRODUCTS
• NEFT
• RTGS SYSTEM
• Basic Concepts
• Process for RTGS Transfer
• Benefits of RTGS
• Difference between RTGS and NEFT
 Payment System’s Vision
• Objective : “To Provide A Safe, Secure, Sound and Efficient payment and
settlement system for the country”
• Increase Efficiency of the Payments systems
• Customer Facilitation for each of the payment system products

• Initiatives driven by the Reserve Bank of India

– Increase in the number of centers offering MICR clearing

– Introduction of High Value Clearing at additional centers
– Electronic Clearing Services (ECS) - debits and credits
– Electronic Funds Transfers (EFT) and Special Electronics funds transfer
(SEFT)
– Real Time Gross Settlement System (RTGS)
– Cheque Truncation
– NEFT
 EFT and SEFT…Net settlement
system
• Electronic Funds Transfer (EFT) and Special Electronic Funds Transfer
(SEFT) facilitate paperless inter and intra-bank settlements; both inter and
intra-city.
• There is no Maximum value limit for an individual SEFT/ EFT transaction.
• EFT is available at 15 locations: Mumbai, Kolkata, New Delhi, Chennai,
Bangalore, Hyderabad, Ahmedabad, Chandigarh, Trivandrum, Jaipur,
Nagpur, Guwahati, Bhubhaneshwar, Patna and Kanpur.
• SEFT covers approximately 3200 networked branches of 35 banks in over
180 cities (currently).
• RBI made it mandatory to migrate all the SEFT banks to NEFT by 15
December 2005
• Two Settlements every day from November 2, 2005
• 10.30am – 3.00 pm
• Working Group on EFT for Capital Markets
 Some EFT Products
• The Govt. Departments can also be credited through EFT from various
banks.
• Some Government Bodies like DGFT receive license fees from lakhs of
exporters, which can be done through EFT.

 ECS (Electronic Clearing Services)

• Used mainly for credit and debits of low value transactions which are in
large or frequent transactions.
• Available at the 44 Clearing Centre.
• (15 RBI Centers, 23 SBI Centers, 2 PNB, 1 Union Bank, 1 Corp Bank, 1
Andhra Bank and 1 SB of Indore)
• Funds transfer on T+2 basis..
• Available for Credit as well as Debit.
National Electronic Funds Transfer
 NEFT
• Better version of RBI-EFT system.
• Requires both the bank to be NEFT enabled system.
• Transfer takes place either on the same day or on the next day
• NEFT take place throughout the day with interval of one hour.
 Parties involved in NEFT are:
– Sender
– Sending branch
– Service branch of sending bank
– RBI NEFT centre
– Beneficiary bank
– Beneficiary

Benefits of NEFT
 Available to all users of the banks.
 Available to all users of the banks.
 Funds transfer to other banks is faster, secure and safe.
 Anytime, anywhere...Simple and easy to operate.
 Save time and energy.
 The Remitter has to provide the following details:

– Amount to be remitted
– Account number which is to be debited
– Name of the beneficiary bank
– Name of the beneficiary
– Account number of the beneficiary
– Remarks or description, if any
– The IFSC code of the beneficiary branch
Real Time Gross Settlement
 RTGS- Basic Concepts
• RTGS system is a funds transfer mechanism where transfer of money
takes place from one bank to another on a 'real time' and on 'gross' basis.

• The transfer of funds in case of RTGS takes place within 2 hours of

receiving the funds transfer message.

• Time for transactions to take place

– Weekdays 9.00 hours to 16.30 hours
– Saturdays 9.00 hours to 12.30 noon

• Information to be furnished by remitter: Amount, Name of Beneficiary

bank, Account No., IFSC No., Name of Beneficiary Customer.
 Basic Concepts
• Charges for RTGS
– Inward Charge No fee to be levied
– Outward Charges
• Rs. 1 lakh to Rs. 5 lakh - not exceeding Rs. 25 per transaction
• Exceeding Rs. 5 lakh - not exceeding Rs. 50 per transaction

• On a day RTGS handles 60000 transactions

• Volume of Transaction – Rs. 2700 billion

• More than 52000 branches are covered by RTGS

PROCESS OF RTGS TRANSFER
 Advantages of RTGS
• Credit and Liquidity risks are eliminated.

• Will lead to seamless movement of funds.

• Minimizing the settlement risks.

• Less costs and fewer errors.

Difference between NEFT AND RTGS

NEFT RTGS
• Net Settlement Process. • Gross Settlement Process

• Based on Deferred Net • Based on Gross Settlement

Settlement

• No minimum fund is fixed. • Minimum of Rs. 1 lakh is to

be transferred

• Transfer of fund takes place • Transfer of funds takes

after a specified time place instantly