Edited and reposted on 11.05.2025 National Automated Clearing House (NACH) is a form of Electronic Clearing Service (ECS) that is available with core-banking-enabled bank branches in India. NACH has primarily two variants viz. ECS Credit and ECS Debit. The facility is used by the bank customers for automatic debit to their account every month to…
FCNR (B) deposits and NRE deposits can be opened by Non-Resident Indians or persons of Indian Origin (PIO) or Overseas Citizens of India (OCI). The difference between FCNR (B) deposits and NRE deposits is that the FCNR-B (Bank) deposits are maintained only in Foreign Currencies term deposits and maturity of these deposits is payable in terms…
IntroductionCHIPS (Clearing House Interbank Payments System) and CHAPS (Clearing House Automated Payment System) are prominent high-value payment systems operating in different jurisdictions. While both facilitate large-value transactions, they differ in terms of currency, geographical scope, settlement mechanism, and typical usage. 1. CHIPS – Clearing House Interbank Payments SystemCHIPS is a U.S.-based electronic payment system primarily…
IntroductionIn the realm of international banking, the terms Nostro, Vostro, and Loro accounts refer to how banks manage and record cross-border transactions and foreign currency holdings. These accounts are essential for facilitating international trade, currency exchange, and interbank settlements, particularly when banks do not have a physical presence in foreign jurisdictions. The terminology originates from…
IntroductionCorrespondent banking in India refers to formal arrangements between domestic and international banks to provide a range of financial services, particularly in the context of cross-border transactions. These partnerships enable Indian banks to offer services such as international payments, trade finance, and clearing, even in jurisdictions where they do not have a physical presence. Such…
Correspondent Banking OverviewCorrespondent banking is a financial arrangement wherein one bank, referred to as the correspondent bank, provides banking services on behalf of another bank, known as the respondent bank, typically across international borders. This framework facilitates access to global financial systems, enabling banks to serve customers in jurisdictions where they lack a direct presence.…
The SWIFT financial messages are trusted as the most authentic and universal financial messages worldwide. SWIFT financial message is also the most convenient and fastest medium through which banks can meet customer’s requirements to send and receive messages to and from any country. Reasons for trusting SWIFT messages by banks and financial institutions: SWIFT stands…
Latest update: RBI on thursday (06.06.2019) informed banks that it has decided to waive charges levied on NEFT & RTGS transactions and accordingly instructed the bank to pass on the benefit to their customers. Instruction on this regard will be issued within a week. Process of RTGS and NEFT RTGS& NEFT transactions are the fastest…
Electronic Clearing Service (ECS) in bank transaction is a simple, faster and cost effective solution for repetitive bulk transactions. The system was first introduced by Reserve Bank of India in April 1995 to facilitate speedier bulk inter-bank transactions. It is most useful to facilitate repetitive payment transaction such as salary, pension, interest, commission, dividend etc. ECS…
The Liberalised Remittance Scheme (LRS), introduced by the Reserve Bank of India (RBI), permits resident individuals to remit up to USD 250,000 per financial year (April–March) for a range of permissible current and capital account transactions. While there are no restrictions on the number of remittances within a financial year, the aggregate amount from all…