Date:11/05/2004 URL: http://www.thehindubusinessline.com/2004/05/11/stories/2004051101630800.htm

Back More banks get on to RTGS system

Poornima Mohandas

Mumbai , May 10

ABOUT 19 more banks have joined RBI's online clearing and settlement system, Real Time Gross Settlement (RTGS) over the last few days.

There are now a total of 23 banks conducting transactions on the new system. This list Bank of Baroda, Punjab National Bank, Canara Bank, Union Bank of India, Indian Overseas Bank, Central Bank of India and Dena Bank. Among the foreign banks, BNP Baripas has joined the set and so has IndusInd Bank and ING Vysya Bank from the private sector.

This is in addition to the four banks - State Bank of India, HDFC Bank, Standard Chartered Bank and Saraswat Bank — with which RTGS kick-started activity in late March 2004. Another seven odd banks are expected to join the world-class payment system in the coming week.

Said Mr Bhaskar Sen, Deputy General Manager-Treasury, Union Bank of India, "We went live on RTGS on Saturday. We conducted money market transactions worth Rs 100 crore very smoothly."

Asked when the bank would start offering the instantaneous money transfer platform to its customers, said Mr Sen, "We will be doing it in 1-2 months time. We have some connectivity and interface issues which will soon be sorted out." Union Bank has 150 branches of its total network on the core banking system, all of which are set to be hooked on to RTGS.

The bank is training its staff, has designed an online application format for customers to transact through RTGS and will soon conduct awareness seminars for customers. Nearly 3,000 bank branches across 275 cities/towns in India are expected to go live on the online fund transfer system according to RBI's plans. This would mean that a bank customer would be able to transfer funds instantaneously between any of these 3,000 branches.

A branch has to be fully computerised, networked and connected to the bank's payment gateway for it to be RTGS-ready. While most the new private sector and foreign banks fulfil this criteria, large parts of PSU banks' networks are still getting there.

Out of the total 23 banks, the early batch of four banks has already embarked upon customer transactions.