Special measures have been taken for 2020-21 in the context of transactions related to annual account closure of Central and State Governments. RBI has asked all member banks to keep sufficient amount in the clearing settlement account.
Reserve Bank of India (nominal picture)
Banks will conduct special clearing operations on 31 March on the last day of the current financial year to complete the annual transactions of government accounts. The Reserve Bank of India (RBI) has issued a directive regarding the smooth clearing operation for banks and has asked them to join it compulsorily. Special measures have been taken for 2020-21 in the context of transactions related to annual account closure of Central and State Governments. RBI has asked all member banks to keep sufficient amount in the clearing settlement account.
The central bank said in a notification issued to member banks, urban and state co-operative banks, payments banks, small finance banks, and the National Payment Corporation of India (NPCI), that the clearance is usually on Wednesday. The deadline that remains on 31 March 2020 will also remain.
Special Clearing arrangement on 31 March
RBI said that for the current financial year, by March 31, 2021, it has decided to have a special clearing system to facilitate all government transactions. This system will be exclusively for government checks on all three check truncation system (CTS) grids.
Under this arrangement, three CTS grids – New Delhi, Chennai and Mumbai will have presentation clearing from 5 pm to 5.30 pm and return clearing will be from 7 pm to 7.30 pm.
Clearing settlement account will have to be kept for sufficient amount
The Reserve Bank said, it is mandatory for all banks that they will be involved in a special clearing operation on March 31, 202. All the member banks under the respective CTS grid will have to keep the clearing processing infrastructure facility open at special clearing times. Also, sufficient amount has to be kept in the clearing settlement account so that settlement obligations can be fulfilled during special clearing.
Checks will be cleared under the CTS system
Under the CTS system, there is no need to present physical for check clearing. Instead, a picture is sent electronically to the paying branch through the Clearing House along with other necessary data. This saves time and saves the time taken in clearance and collection of checks.
Transactions can be done 24 hours via NEFT and RTGS
The central bank said that all banks will open their designated branches on March 31, 2020 as a normal working day for government related transactions through the counter. The transaction will continue for 24 hours on March 31, 2021 through National Electronic Funds Transfer (NEFT) and Real Time Gross Settlement (RTGS) arrangements.
Information regarding uploading of GST / E receipt with reference to Central and State Government transactions to RBI will be given by 12.00 noon on April 1, 2021.
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