**Executive Summary**
This document outlines guidelines from the Reserve Bank of India to facilitate faster cross-border inward payments, aligning with the G20 roadmap and the Reserve Bank's Payments Vision 2025. The key objective is to improve the speed, transparency, and accessibility of these payments. The directions outlined in paragraph 3 will be effective six months from the date of the circular.
**Key Points / Main Content**
* **Customer Communication & Reconciliation:**
* Banks must immediately inform customers upon receiving cross-border inward transactions. If received after operating hours, notification should occur at the start of the next business day.
* Banks must reconcile and confirm credits in nostro accounts on a near real-time basis or at periodic intervals, not exceeding 30 minutes.
* **Payment Crediting:**
* Banks should credit inward payments received during foreign exchange market hours on the same business day and those received after market hours on the next business day, subject to FEMA compliance.
* Banks may implement straight-through processing for crediting inward payments to resident accounts, based on risk assessment and FEMA guidelines.
* **Digital Interface:**
* Banks may strive to provide digital interfaces for customers to facilitate foreign exchange transactions.
* **Authority and Effective Date:**
* The directive is issued under Section 10(2) read with Section 18 of Payment and Settlement Systems Act 2007, (Act 51 of 2007).
* The directions at paragraph 3 are effective six months from the date of the circular.
**Impact Analysis**
**Stakeholder: Scheduled Commercial Banks**
* **Impact:** Banks are required to adjust their internal processes to ensure timely customer notification, faster reconciliation, and efficient crediting of cross-border inward payments. They may also need to develop or enhance digital interfaces for foreign exchange transactions.
* **Action Required:** Banks must review and update their existing systems and procedures to comply with the new guidelines, including updating customer communication protocols, improving nostro account reconciliation processes, and adjusting payment crediting timelines. They must implement these changes within six months of the circular's date.
**Stakeholder: Customers (Beneficiaries of Cross-Border Payments)**
* **Impact:** Customers will receive faster notification of inward payments and quicker access to funds credited to their accounts.
* **Action Required:** No direct action is required from customers, but they should be aware of the improved service standards and can expect faster processing of cross-border payments.
Key Entities Referenced
Payments Vision 2025: Reserve Bank's scheme aiming to improve the efficiency of cross-border payments.
Payment and Settlement Systems Act 2007: The directive is issued under Section 10(2) read with Section 18 of this Act.
FEMA: Foreign Exchange Management Act. Banks must comply with extant FEMA guidelines
Scheduled Commercial Banks: Entities to whom the guidelines for faster cross-border inward payments are addressed.
G20: The guideline is aligned with the G20 roadmap to make cross-border payments cheaper, faster, more transparent, and more accessible.
DPSS.CO.ID.No / 06.08.017 / 2025-26 DD-MM-YYYY
The Chairman / Managing Director / Chief Executive Officer
All Scheduled Commercial Banks
Madam / Dear Sir,
Guidelines to facilitate faster cross-border inward payments
The Reserve Bank’s Payments Vision 2025 aims to bring efficiency in the cross-border
payments aligning with the G20 roadmap to make them cheaper, faster, more
transparent, and more accessible.
2. The speed of cross-border payments is affected by several factors. One of
these factors is the delay at the beneficiary leg i.e., the time taken from receipt of the
payment at the beneficiary bank till credit to the beneficiary account. Streamlining the
processes at the beneficiary bank would ensure timely intimation of payment
information and credit to the beneficiary’s account.
3. Accordingly, banks are advised as under:
a. Banks shall inform their customer of the receipt of cross-border inward
transactions immediately on receipt of inward message. Messages received
after close of operating hours of the individual banks shall be informed to the
customer immediately at the start of the next business day.
b. It is observed that several banks rely upon end-of-day statements of the nostro
account for confirming and reconciling receipts in nostro accounts, resulting in
delayed credit. To expedite this process, banks are advised to undertake
reconciliation and confirmation of credit in the nostro account either on near real
time basis or at periodic intervals. The reconciliation interval should normally not
exceed thirty minutes.
c. Banks shall endeavour to credit the inward payments received during the
foreign exchange market hours within the same business day to the
beneficiary’s account, and credit the inward payments received after market
hours on the next business day, subject to compliance with the extant FEMA
and other regulatory requirements.d. Banks may, based on their risk assessment and subject to compliance with
extant FEMA guidelines, put in place a straight through process for crediting
inward payments to the account of individual residents.
e. Banks may, within a reasonable time frame, endeavour to provide digital
interface to their customers to facilitate foreign exchange transactions, including
submission of documents or information, and monitoring of transactions.
4. The directions at para 3 above shall be effective six months from the date of
this circular.
5. The directive is issued under Section 10(2) read with Section 18 of Payment
and Settlement Systems Act 2007, (Act 51 of 2007).
Yours faithfully,
(Gunveer Singh)
Chief General Manager-in-Charge
2