RedGage

As you are aware, the ReserveBank of Indiahas taken a series of initiatives in the recent past to facilitate electronic mode of funds transfers as a result of which the volume processed in RTGS and NEFT systems have grown substantially. It is observed that of late, certain banks have been accepting receipts toGovernmentaccounts through RTGS.However, banks are not following a uniform practice while facilitating such transactions. On the basis of discussions with various major RTGS participant banks, it has been decided as under:

As per the extantGovernmentrules, only accredited banks are permitted to receive payments toGovernmentand every credit to theGovernmentaccount needs to be supported by a Challan. The RTGS message transfer platform is designed to carry onlyfunds transfermessages and not challan. The receiving bank therefore is not in a position to afford credit to theGovernmentaccount in the absence of the challan accompanying the message in RTGS. This often results in transactions getting returned.

In order to facilitateGovernmentreceipts through RTGS it has been decided that participants originatingGovernmenttransactions in RTGS can do so only when the receiving bank is in agreement with the sending bank to receive funds. In case it is bilaterally decided to undertake such afunds transferin RTGS, banks have to use the interbank mode R 42 for such transfers.

RTGS participants may please note that this is an interim arrangement and would continue till such time the procedure followed forGovernmentreceipts is fine tuned with RTGS frame work.

The bank originating the transaction must capture complete information of the sender and receiver in the message format in conformity with Wire Transfer guidelines. The message may carry additional information if required by the receiving bank in field tag 7495.

Please acknowledge receipt.

Yours faithfully,

(G. Padmanabhan)

Chief General Manager

CIRCULAR DETAILS

RBI/2009-10/ 226

DPSS (CO) RTGS No.991/ 04.04.002 / 2009 – 2010 November 17, 2009

ISSUED TO

Chairman and Managing Director /

Chief Executive Officerof all banks participating in RTGS