Electronic Fund Transfer


Presentation Description

the presentation is about Electronic fund Transfer.. which includes, RTGS, NEFT, SFMS etc..


Presentation Transcript


Mini Project Hari P M Neethu Mariam Ajith Reejasha Presentation By


Electronic Fund Transfer




The clearing house is a voluntary association of banks under the management of a bank where settlement accounts are maintained. Clearing Houses


In the absence of an office of the RBI, the clearing house is managed by SBI, its associates banks and in a few cases by public sector banks. Wherever RBI has its office the clearing house is maintained by it. Clearing House


In India there are about 1050 cheque clearing houses, 840 clearing houses are managed by SBI and its associates and the rest by others. Clearing House


The clearing houses clear and settle transactions relating to various type of paper based instruments like cheque, draft, payment orders and interest/dividend warrants etc.. Clearing House


From the days of manual clearing operations, the Reserve Bank of India manages the clearing houses at the key business centers and has been at the forefront in driving the initiatives towards a more electronic payment and clearing system. Clearing House


ELECTRONIC BANKING The electronic banking is a banking system where by banking services and products are made available to consumers through electronic channels . It removes the consumer constrains regarding branch location timing, geographical boundaries etc.


It ensure value added services for basic banking requirements . E-Banking


E – Banking Services


E - banking is a an umbrella term for the process by which a customer may perform banking transactions electronically without visiting the institutions E-Banking


DEFINITION E-banking defined as the automated delivery of new and traditional banking product and services directly to customers through electronic interactive communication channels . E- banking includes the system that enable financial institution, customers , individuals or business to access accounts , transact business or obtain information on financial product and services through public or a private network , including the internet. E-Banking


SBI Online Fund Transfer


ECS is used by institutions for making bulk payment of amounts towards distribution of dividends, interest, salary, pension etc.. Or for bulk collection of amounts towards telephone / electricity dues , tax collection, loan installment payments etc.., electronically. Electronic Clearing Services


Requires expensive administrative machinery Chances of loss of instruments in transit and their fraudulent encashment The customers also have to keep track of the receipt/non receipt of the instrument Difficulties


Bank find processing of such a large volume of instruments not only error prone and monotonous, but also a strain ion the cheque clearing system.


VARIANCE OF ECS ECS CREDIT Used for affording credit to a large number of beneficiaries having accounts with bank branches at various location with in the jurisdiction of a ECS centre by raising a single debit to an account of a bank. Enables payment of amounts towards distribution of dividend, interest etc. of the user institutions


User Sponsor Bank RBI National Clearing Cell Destination Account Holder PARTICIPANTS OF ECS CREDIT Electronic Media Destination Bank Branches companies / corporations/ Government Departments or any other institutions Bank which acts as the agent of the user to submit the input data Reserve Bank of India established under the Reserve Bank of India Act 1934. Functional unit of the local bankers clearing house or such other agency to be created by RBI Beneficiaries under the scheme who opt for receiving payments Bank branches where Destination Account Holders maintain their bank accounts Any media or the data put through a network on the website hosted by the NCC




Savings in administrative cost Reconciliation transaction is made automatic by the time ECS cycle is completed. Cash management becomes easier as arrangement for funds is required to be made only on the specified date. Ensuring better customer service. BENEFITS OF ECS CREDIT TO THE CORPORATE BODY/ INSTITUTION


Paying the way the best companies in the world pay to their shareholders/ investors/customers . Loss of instruments in transit and their fraudulent encashment thereof totally eliminated . ECS Credit


Freedom from paper handling and the resultant disadvantage of handling , presenting and monitoring paper instruments presented in clearing . Smooth process of reconciliation for the sponsor banks. Cost effective. BENEFITS TO THE BANKING SYSTEM


Payment on the due date Effortless receipt In case of loss of instruments in trans it and their fraudulent encashment there of and consequent correspondent with the company are totally eliminated. Cost effective TO THE BENEFICIARY CUSTOMERS


The beneficiary has to furnish a mandate to the user institution giving consent to avail the ECS credit facility . The mandate contains details of his / her bank branch , account particulars and authorizes the user institution to afford credit to his/her account with the destination bank branch ECS Credit


In case the information / account particulars contained in the mandate undergo any change , the beneficiary has to notify the changes to the user institution so that the correct information can be incorporated in its records. ECS Credit


It is the responsibility of the user institution to communicate to the beneficiary the details of credit that is being afforded to his/her account, indicating the proposed date of credit , amount and related particulars of the payment ECS Credit


If a destination bank is not in a position to credit the beneficiary account due to any reason the same would be returned to the ECS centre to enable the ECS center to pass on the unaccredited items to the user institution through the sponsor bank . The user institution can then initiate alternate modes of payment. ECS Credit


There is no value limit on the amount of individual transaction. The RBI has deregulated the charges to be levied by sponsor banks from user institutions. The sponsor banks are however required to disclose the charges in a transparent manner. ECS Credit


Method for affecting payment transactions in respect of the utility – bill – payments such as telephone bills, electricity bills insurance premium, card payment and loan repayment etc. which would obviate the need for issuing and handling paper instruments and there by facilitate improve customer service. ECS DEBIT CLEARING


PARTIES TO THE ECS DEBIT SCHEME User: utility companies, insurance corporations / government departments or any other institution receiving / collecting payments. Sponsor Bank : B ank which has agreed to act as the agent of the user company. Reserve Bank of India National Clearing Cell : functional unit of the local banker’s clearing or such other agency to be created by RBI. Destination Account Holder : utility customers/ end users under the scheme. Destination Bank Branches : bank branches where the destination account holder maintain their accounts Electronic Media : media to carry data in electronic form such as floppy, CD etc Reserve Bank of India Electronic Media User Sponsor Bank National Clearing Cell Destination Account Holder Destination Bank Branches


WORKING OF ECS DEBIT User institution initially collect mandates from their customers for collection of amounts due from them. Based on the details furnished in the mandates, the user company prepares transaction data. After due validation of the data, the local clearing house processes the same and arrives at the interbank settlement as also generates bank wise / branch wise reports NCC debits the destination bank’s accounts with clearing house and simultaneously affords a consolidated credit to the sponsor bank’s account and furnishes the bank wise / branch wise reports to the service branches of the destination banks. Service branches forward the branch wise reports to the respective branches for debiting the accounts of customers with the indicated amounts.


Savings on administrative machinery and costs of collecting the cheque from customers ,presenting in clearing ,monitoring their realization and reconciliation. BENEFITS OF ECS DEBIT TO THE USER INSTITUTION


Better cash management because of realization and recovery of dues on the due dates promptly and efficiently. Avoid chances of loss / theft of instruments in transit. Cost effective. ECS Debit


Customers need not visit the bank branches / collection centers of utility service providers. Customers need not keep track of due date for payment. The debits to the customer accounts would be monitored by the ECS user and the customers alerted accordingly. TO THE CUSTOMERS


Freedom from paper handling and the resultant disadvantage of handling , receiving and monitoring paper instruments presented in clearing . Ease of processing and return for the destination bank branches Smooth process of reconciliation for the sponsor banks. Cost effective. TO THE BANKING SYSTEM


ECS Local ECS Regional ECS National ECS ECS Classification Operating at 81 centers / locations across the country. At each of these centers , the branch coverage is restricted to the geographical coverage of the clearing house . Operating at 9 centers / locations at various parts of the country . RECS facilitates the coverage all core – banking – enabled branches in a state or group of states and can be used by institutions desirous of reaching beneficiaries within the state / group of states . Centralized version of ECS credit which was launched din October 2008 . The scheme is operated at Mumbai and facilitate the coverage of all core – banking enabled branches located anywhere in the country. Banks are free to add any of their core banking – enabled branches in NECS irrespective of their location


Sponsors Bank User Institution Clearing House Destination Bank’s service Branches Beneficiaries Account Destination Branch Data on Day 1 Reports on Day 1 Encrypted Data on Day 1 Reports on Day 1 Credit on Day 1


Bank Cards


Bank cards are generally defined as any cards issued by a bank even a non – traditional bank that access a customer financial resources. Bank Cards


Bank cards are form of customer loan, a revolving credit account that has a credit line of a specific amount that can be borrowed against in part or in full. As the outstanding balance is paid, the available credit line is resorted for use again. Bank Cards


Automated Teller Machine Automated Teller Machine ATM is an electronic machine which allows the access to withdraw and lodge cash, pay bills, request statements and other banking transactions. The requires an ATM card and identification number to gain access to the machine.


Fast Cash Cash Withdrawal Balance Enquiry Mini Statements Pin Change Other Services The various services provided by ATM


Working of SBT ATM


ATM cards extends banking convenience to banking customers. ATM operates around the clock 24*7, 365 days a year. Facilities offered by ATM


Innovative, secure, competitive Reduces customer visits in to bank Inter bank reconciliation is immediately Value added product to the bank Better banking service Benefits to Banks:


Draw cash outside banking hours Issued free of charge Complete security Transfer of fund is easy Can get details of last five transactions Save time Benefits to Customers :


ATM cum Debit Card is a bank card which combines the advantages of both ATM and debit card. ATM cum Debit Card




Credit Card


A smart card, chip card or integrated circuit card (ICC) is any pocket sized card with embedded integrated circuits. Smart cards can provide identification, authentication, data storage and application processing. Smart Card


Smart Card


debit cards, credit cards and smart cards are collectively referred to as plastic money, because they are made out of plastic. Plastic Money


ELECTRONIC FUND TRANSFER Transfer of fund from one source to another through electronic media . It enable transfer of fund in the following ways. 1.Transfer of fund with in the city 2.Transfer of fund between the cities 3.Transfer of fund between branches 4. Transfer of fund between banks


EFT introduced by Reserve bank of India to help banks offering their customer money transfer services from account to account of any bank branch in places where EFT services are offered. EFT


The remitting bank transmits the fund transfer message to RBI so as to reach National Clearing Cell (NCC), the receiving banks account is credited by RBI at the destination centre and beneficiary gets credit on the same day. EFT


The customer receives a written receipt when an electronic transfer is initiated and periodic statements describe each transfer. EFT


Electronic funds transfer is a transfer of funds is initiated through an electronic terminal, telephone, computer (including on-line banking) for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit a consumer’s account. (Section 205.3(b)).   DEFINITION EFT


1. Fast and secure direct deposit of your claim payments 2. Reduced paperwork 3 . E-mail notifications the day deposits are made 4 . Easy reconciliation of direct deposits Benefits of EFT

5. No need to change the way you submit claims or post payments 6. Easy online access to view, search, print and download information :

5. No need to change the way you submit claims or post payments 6. Easy online access to view, search, print and download information EFT


Nation wide system that facilitates individuals, firms and corporate to electronically Transfer funds from any bank branch to any individual, firm or corporate having an account with any other bank branch in the country. for being a part of NEFT fund transfer network , a bank branch has to be NEFT enabled. Walk –in customers can also deposit cash at the NEFT enabled branch NATIONAL ELECTRONIC FUND TRANFER


It is necessary for the beneficiary to have an account with the NEFT enabled bank branch in the country. NEFT system also facilitate one-way-cross-border transfer of fund from INDIA to NEPAL known as INDO –NEPAL Remittance Facility Scheme. A remitter can transfer fund from any of the NEFT enabled branch into NEPAL NEFT


Customer intending to remit money through NEFT has to furnish the following particulars; IFSC (Indian Financial System Code) of the beneficiary bank/ branch. Full account number of the beneficiary. Name of the beneficiary. NEFT


Customers can use this facility between 8 am and 7 pm on all week days Between 8 am and 1 pm on Saturday. Eleven hourly settlement on week days. Five hourly settlement on Saturdays. The money will be credited to the beneficiary’s account on the same day or at the most next day NEFT TIMINGS


to be eligible to apply for admission, an applicant Shall be a bank. Shall be a member of RTGS. shall have installed SFMS. shall meet the other prescribed eligibility criteria / conditions which are notified by RBI from time to time. NEFT ELIGIBILTY CRIETERIA


If a particular bank has defaulted in meeting its settlement obligation or paying any charge or fees or complying with any procedural guidelines, the letter of admission issued to it is liable to be kept under suspension for such period as may be specified in the order of suspension. SUSPENSION


Every order of suspension shall be notified immediately to all participating banks and institutions including a bank or institution against which the order of suspension is passed.


An order of suspension may be reviewed and may be revoked at any time by the Governor, Reserve Bank of India upon representation received from the concerned bank or on his own . every revocation shall be notified immediately to all participating banks.


A participating bank shall not , while any order of suspension is in force against it, be entitled to send or receive any NEFT message or otherwise to effect any funds transfer in the NEFT system.


There is no limit either minimum or maximum on the amount of funds that could be transferred using NEFT. However maximum amount per transaction is limited to Rs 50000 for cash based remittance and remittance to Nepal. There is no restriction of centers or of any geographical area within the country. The NEFT system takes advantage of the core banking system in banks. Accordingly the settlement of funds between originating and receiving banks take places centrally at Mumbai , whereas the branches participating in NEFT can be located any where across the length and breadth of the country. NEFT


WORKING OF NEFT Step 1 Step 2 Step 3 Step 4 An individual / firm / corporate intending to originate transfer of funds through NEFT has to fill an application form providing details of the beneficiary and the amount to be remitted The originating bank branch prepares a message and sends the message to the NEFT service centre. The service centre forwards the message to the NEFT clearing centre to be included in the next available batch. The clearing centre sorts the funds transfer transactions destination bank wise and prepares accounting entries to receive funds from the originating bank and give the fund to the destination bank The destination banks receive the inward remittance message from the clearing centre and pass on the credit to the beneficiary customer’s account. Step 5


Inward transactions at destination bank branches – free , no charges to be levied from beneficiaries. Outward transactions at originating bank branches- charges applicable for the remitter Transactions up to Rs 10000 not exceeding Rs 2.50(+service charge) Transactions above Rs10000 up to Rs 1 lakh : not exceeding Rs 5(+service charge) Transactions above Rs 1 lakh and up to Rs 2 lakh : not exceeding Rs15(+service charge). Transactions above Rs 2 lakhs : not exceeding Rs 25 (+service charge). PROCESSING OR SERVICE CHARGES FOR NEFT TRANSACTION


With effect from July 1 ,2011, the originating banks are required to pay a nominal charge of 25 paise each per transaction to the clearing house as well as destination bank as service charge . However these charges cannot be passed on to the customers by the banks.


The beneficiary can expect to get credit for the first ten batches on week days and the first five batches on Saturdays on the same day. For transactions settled in the last two batches on week days and the last batch on Saturdays beneficiaries can expect to get credit either on the same day or on the next working day morning


In case of non credit or delay in credit to the beneficiary account , the NEFT customer facilitation centre of the respective bank can be contacted If the issue is not resolved satisfactorily , the NEFT help desk at NCC , RBI , Mumbai may be contacted through e mail or by addressing correspondence. If it is not possible to afford credit to the account of the beneficiary for whatever reason, destination banks are required to return the transaction to the originating bank within two hours of completion of the batch in which the transaction was processed.


Besides personal fund transfer , the NEFT system can also be used for a variety of transactions including payment of credit card dues to the card issuing banks.


The remitter need not send the physical cheque or DD to the beneficiary. The beneficiary need not visit his / her bank for depositing the paper instruments. The beneficiary need not be apprehensive of loss/ theft of physical instruments or the likelihood of fraudulent encashment there of . Credit confirmation of the remittances sent by SMS or e mail. BENEFITS OF NEFT


5. Remitter can initiate the remittance from his home / place of work using the internet banking also.


Inter Bank Mobile Payment System


Inter Bank Mobile Payment System



IFSC is an alpha numeric code that uniquely identifies a bank branch participating in the RTGS / NEFT system. This is a 11 digit code with the first four alpha characters representing the bank, and the last six numeric characters representing the branch. The fifth character is zero. :

IFSC is an alpha numeric code that uniquely identifies a bank branch participating in the RTGS / NEFT system. This is a 11 digit code with the first four alpha characters representing the bank, and the last six numeric characters representing the branch. The fifth character is zero. INDIAN FINANCIAL SYSTEM CODE

The INFINET is the communication backbone of the Indian Banking and Financial Sector. All banks – Public Sector, Private Sector, Foreign, Cooperative etc., and premier Financial Institutions in the country are eligible to become members of the INFINET.:

The INFINET is the communication backbone of the Indian Banking and Financial Sector. All banks – Public Sector, Private Sector, Foreign, Cooperative etc., and premier Financial Institutions in the country are eligible to become members of the INFINET. Indian Financial Network (INFINET)


Core banking The revolution in the information technology sector could develop wide area network of computers the wan encouraged banking sector to introduce core banking with a view to improve the customer services .


Under this the database for the whole bank is maintained at central point. The database can be assessed from any part of the world through internet. The customer can transact their business though any branch The transfer from one branch to another is possible on real time basis. The silent feature of core banking


Merits of Core Banking The consumer need not go to the concerned branch where he keeps the account The customer can save time also with out visiting the banking premises It helps to achieve overall efficiency in banking sector


Centralised Fund Management System


Is a system set up, operated and maintained by the RBI Enable operations on current accounts maintained at various offices of the bank, through standard message format in a secure manner It has two components Centralized fund enquiry system(CFES) Centralized fund transfer system(CFTS) These have been made available through the following systems Apex Level Server(ALS) Local Fund Management System(LFMS) Bank Level Fund Management System(BLFMS) Local Banks Fund Management System(LBFMS) CENTRALISED FUND MANAGEMENT SYSTEM


ALS is a software component which resides in the mainframe computer LFMS is the software component which would be functioning from the server system at the regional offices of the RBI where the Deposits Account Department (DAD) is existed BLFMS is the software component provided by the RBI to the members of the CFMS LBFMS is the software component which would be given by the RBI to the CFMS members for accessing the facilities at each local DAD. CFMS


Each entity , which maintains a current account with the RBI and is a member of INFINET. Admission to the CFMS may be granted , suspended or revoked by the RBI at its own sole discretion . All applications for the CFMS membership shall be addressed to the Regional Director , Reserve Bank of India , Deposit Accounts Departments, where the current account of the institution is maintained with . ELIGIBILTY CRITERIA


Enquiries relating to the operation of its current account maintained with any of the DAD. Fund transfer between accounts at different DADs TRANSACTIION TYPES


Normally be operational on all days on which at least to DADs of RBI are working. The bank may at its discretion , change the operating calendar . Any changes to the operating calendar or any declaration of unscheduled holidays will be communicated by the RBI to the members by means of a broadcast message or otherwise. CFMS OPERATION SESSION


Real Time Gross Settlement System


REAL- TIME GROSS SETTLEMENT The Real Time Gross Settlement System is the key critical element and provides the missing link in the process of the setting up of the integrated Payment and settlement System in the country. The world over, the Real Time Gross Settlement System is now, the preferred mode of the settlement of interbank payments, with more and more countries moving towards it.


A settlement process, RTGS minimizes settlement risks by setting individual payments in real time in the books of account, held at the Central Bank. Under RTGS, practically instant settlement ensures fast, secure, final and irrevocable settlement of payment transactions. RTGS


The RTGS system is designed to provide large value fund transfer and settlement in an on-line real tine environment to the banking industry, with settlement on a gross basis. RTGS


The system would have link with other netting systems like Clearing, Automated Clearing House transactions comprising Electronic Clearing Services, Retail Electronic Fund Transfer, all Plastic Money and Smart Card transactions. RTGS


A large value fund transfer system, whereby financial intermediaries can settle interbank transfers for their own accounts as well as for their customers, the RTGS system effects final settlement of interbank fund transfers on a continues, transaction – by – transaction basis throughout the processing day. RTGS






It improves confidence of outside agencies like World Bank on Indian Economy. It enables efficient settlements and avoids settlement delays. For the Economy


It offers immediate and irrevocable settlement. It provides high value intra – bank and inter bank fund transfer. It provides new opportunities for formulation of innovative products. RTGS


It provide sophisticated online banking services. It offers reliable high – value fund transfer. It improves personal image with beneficiary. For the Customers


Launched on December 14 ,2001 at IDRBT Secure messaging standard developed to serve as a platform for intra bank and inter bank applications. Indian standard similar to SWIFT (Society for world – wide Inter bank Financial Telecommunications) which is the international messaging system used for financial messaging globally. STRUCTURED FINANCIAL MESSAGING SYSTEM


Can be used practically for all purposes of secure communication within the bank and between banks. The inter bank messaging part is useful for applications like EFT,RTGS,CFMS etc..


Structured Financial Messaging Solution SFMS has been introduced by RBI in November 2001 IDRBT and Tata Consultancy Services entered into an agreement on 15 th February 2001 for deploying a message solution for the Indian Banking and financial Sector. Its an application which would be riding on the backbone of the INFINET SFMS provide security in the various EFT services introduced by RBI, such as ECS and prevents its unauthorized usage It brings the benefit of safe, secure and efficient fund transfers


Negotiated Dealing System


In order to improve efficiency in the market, the Reserve Bank of India took steps to automate the process of trading and settlement of Government securities transactions and the Negotiated Dealing System (NDS) was introduced in February 2002. Negotiated Dealing System


The Negotiated Dealing System (NDS) has two modules – one for the primary market and the other for the secondary market. NDS


The Reserve Bank uses the primary auction platform (NDS Auction) for auction of both, dated securities of the Government of India and the State Governments as also, treasury bills. Primary Market Module


This platform allows participants to electronically submit their bids in the primary auctions and receive allotment reports. NDS


Creation of issues Submission of bids Processing of bids Allotment advice Settlement Main Features Of The Auction Platform Are:


Secondary market trading in Government securities can happen over-the-counter (OTC). These trades generally happen over phone. Players are required to report secondary market trades on the NDS. Secondary Market Module


Once they complete the reporting process and the system accepts trades, the data automatically flows to the Clearing Corporation of India Ltd. (CCIL) for clearing and settlement.


This avoids paper based settlement process. Paper based system required participants to exchange subsidiary general ledger (SGL) forms for transfer of securities and cheques for transfer of funds. NDS


The Reserve Bank introduced the Negotiated Dealing System-Order Matching system or NDSOM as it is called, in August 2005. The NDS-OM is an electronic, screen based, anonymous, order driven trading system for dealing in Government securities. NDS – Order Matching


The Reserve Bank owns NDS-OM and CCIL maintains it. The platform is in addition to the existing facility of over-the-counter (OTC) or phone market in Government securities. NDS - OM


The NDS-OM brings transparency in secondary market transactions in Government securities. Members can place bids (buy orders) and offers (sell orders) directly on the NDS-OM screen. NDS - OM


Being order driven, the system matches all bids and offers on price/time priority, that is, within the orders of the same price, it matches the oldest order first. The system ensures complete anonymity among the participants as CCIL acts as the central counter party (CCP) for settlement of all the trades. NDS - OM


The NDS-OM also facilitates straight-through-processing (STP), that is, all the trades on the system are automatically sent to the CCIL for settlement. NDS - OM


With the efficiency and ease of its operations, the NDS-OM has today captured over 80 per cent of the trading volume in Government securities. NDS - OM


There are two kinds of participants in NDS-OM – direct and indirect. Direct members have current and SGL accounts with the Reserve Bank and can directly settle their trades on NDS-OM. Participants


Indirect members are those players who do not have current and SGL accounts with the Reserve Bank and therefore have to trade on NDS-OM through members who have these accounts with the Reserve Bank. NDS - OM


More specifically, currently banks, including state cooperative banks, primary dealers (PDs), insurance companies, mutual funds and larger provident funds have current and SGL accounts with the Reserve Bank and therefore can directly trade on NDS-OM. NDS - OM


Banks and PDs provide custodial services to indirect members by opening their securities and funds accounts. Indirect members can place orders through their custodian using client accounts. NDS - OM


Such trades would finally settle through the Constituent SGL (CSGL) account and current account of the custodian who is a direct member. NDS-OM currently has direct membership from more than 130 financial institutions. NDS - OM


Following are the prerequisites of obtaining membership of the NDS-OM: SGL account with the Reserve Bank Current account with Reserve Bank* INFINET (Indian Financial Network) connectivity Membership of CCIL Who can be a member of NDS-OM?

Why trade on NDS-OM? :

Why trade on NDS-OM? NDS-OM ensures anonymity of participants and, therefore, ensures objective pricing in the market. Reporting happens simultaneously with trades on NDS-OM; whereas in the OTC market participants need to report the transactions separately.


The system provides information, both pre-trade and post-trade on real time basis. This assures transparency and better price discovery as against the OTC market where there could be a delay of up to 30 minutes in information dissemination. NDS - OM


Trading happens in standardised lot size of Rs.5 crore and in multiples of Rs.5 crore providing enough liquidity in the system. NDS - OM


To facilitate trading in small lot sizes of less than Rs.5 crore, a separate ‘odd lot’ segment (with the minimum trading lot size being only Rs.10,000) is also available. NDS - OM


Participants get to know the depth of the market as the system shows the order depth in terms of number and total amount of sell/ buy orders for each security. This is not possible in OTC market. NDS - OM


There is a high level of operational ease as the entire cycle of placing orders, trading and settlement of trades is fully automated. NDS - OM


Once the trade is concluded on the system, it is treated as confirmed for settlement. In the OTC market, deals have to be confirmed on NDS and only then they are accepted for settlement. NDS - OM


SWIFT provides a network that enables financial institutions world wide to sent and receive information about financial transactions in a secure, standardized and reliable environment. SWIFT was founded 1973 and was supported by 239 banks in 15 countries. SWIFT


fundamental operating procedures, rules for liabilities etc were established in 1975 and the first message was sent in 1977 As on September 2011 SWIFT linked more than 9000 financial institutions in 209 countries and territories who were exchanging an average over 15 million messages per day. The chairman of SWIFT is Mr. Yawar Sha, who is from Pakistan


The CEO is Mr. Gottfried Leibbrandt, who is from Netherland SWIFT transport financial messages in a highly secure way but does not hold accounts for its members and does not perform any form of clearing or settlement Majority of International Interbank Messages use the SWIFT network.


SWIFT is a co operative society under Belgian law and it is owned by its member financial institutions. It has offices around the world, SWIFT headquarters is at Belgium near Brussels SWIFT secure messaging network is run from two redundant data centers, one in the US and one in Netherland


In case of a failure in one of the data centers the other is able to handle the traffic of the complete network. SWIFT opened a third data centre in switzerland which started operation in 2009


Practical Part


1. To analyze the perception of Banking Employees and Banking Customers towards EFT. 2. To study the fund transfer in UAE Exchange. Objective


The current study is based on both primary and secondary data. The primary data is collected through Questionnaire and telephone interview. The secondary data were collected from various publications, journals, web site etc. SOURCE OF DATA  


Study is based on sample of banking employees and customers of various banks. Twenty banking employees and banking customers have been selected as sample. UAE exchange also selected under study. Sample Design


Collection and Analysis of Data The Questionnaire is used to collect information from banking employees and banking customers. Telephone interview is used to collect information from UAE Exchange. The data were tabulated to pave way for easy and meaningful analysis percentage was employed for analysis and interpretation of data.  


Perception of Banking Employees to EFT


Respondents Profile


Name of the Banks




Experience in the field banking field


Pre – electronic period was better than post electronic YES NO 0 % 100%


Bank faced any problem in connection to electronic clearing system and interbank fund transfer (RTGS) ? YES NO 0 % 100%


Bank faced any problem in connection to electronic clearing system and interbank fund transfer (NEFT) YES NO 0 % 100%


Type of clients who avail electronic clearing services and interbank fund transfer (RTGS, NEFT)


Bank receives complaints regarding the EFT Technology and customer services? YES NO 0 % 100%


BENEFITS RANK Increases customer access V Reduce workload of employees III Reduce paper work II Time and cost savings I Attract new customers IV Facilitate offering new services VI Ranking the benefits received by banks through Electronic Fund Transfer:


Findings and Suggestions


Customers Perception


Respondents Profile


Age wise classification


Residence wise classification


Education level Classification


Occupation wise Classification


Income wise Classification




Type of Account


How long you being a bank account holder


Technologies Fully aware Partly aware Unaware RTGS 40 % 40 % 20 % NEFT 40 % 40 % 20 % ECS 40 % 35 % 25% NDS 30 % 25 % 45% SWIFT 20 % 10 % 70 % Awareness level Classification


How did you came to know about Electronic Banking facilities Source % Friends and Relatives 55 Bank Officials 15 Advertisements 20 Website 10


Do you get any amounts credited to your accounts via auto credit : YES NO 90 % 10 %


Features Rank Ease of use 2 Time saving 1 Any where banking 3 Quick and Prompt Settlement System 5 Error free transaction 6 Convenience 4 Ranking the benefits received by customers through Electronic Fund Transfer:


Do you think that EP & SS and its services are one of the best facilities offered by the banks in the recent time? YES NO 100 % 0 %


Do you face any problem while using Electronic Fund Transfer? YES NO 0 % 100 %


Does your bank provide any grievances redressed facility in EFT? YES NO 100 % 0 %


Does your bank provide any awareness programme regarding electronic payment systems? YES NO 20 % 80 %


Findings and Suggestions


Company Profile Type – Limited Liability Company Industry – Financial Services Founded – 1980 Founders - Bavaguthu Raghuram Shetty and Abdulla Humaid Al Mazroei Headquarters - Abu Dhabi ,  United Arab Emirates Over  three decades  of service excellence


Conveniently located branches with customer-friendly working hours Direct operations spanning five continents with  660+  direct offices 6%  - Our market share of global remittance business Correspondent bank network covers over  150  leading global banks


Over  8,000  people employed worldwide Workforce diversity of over  40 nationalities The first exchange house to get the  SWIFT membership More than  4 million  registered customers worldwide Global net worth of more than US$  300 million


SWIFT membership, ISO quality certifications, Dubai Quality Appreciation Programme award, Dubai Service Excellence Scheme Award, MRM Business Excellence Award, UAE Emiratisation Award, Deutsche Bank STP Excellence Award, quadruple Superbrand status Recognitions


Y. Sudhir Kumar Shetty COO - Global Operations Promoth Manghat VP - Global Operations Gopakumar Bhargavan Chief Marketing Officer Ashwin Shetty VP - Dealing Sarath Chandra M Chief Information Officer Management


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N.Subramani, M.Murugesan etal, 2008, E’ – Banking and ‘E’ – Commerce, Abhijeeth Publications, New Delhi. Nidhin Kapoor, 2008, Computerized Banking System in India , Sublime Publications , Jaipur. K. Sohani , 2009, Technology in Banking Sector, Icfai University Pres, E – Banking and E – Commerce – Vikas Taneja and Sakshi Parashar, 2011, Alfa Publications, New Delhi. Bibliography


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