Saving Bank Account Cash Withdrawal Limit hikes to Rs. 50000 Per week w.e.f. 20.02.2017

Removal of limits on withdrawal of cash from Saving Bank Accounts

RBI/2016-17/224
DCM (Plg) 3107/10.27.00/2016-17

February 08, 2017

All Banks

Dear Madam / Sir,

Removal of limits on withdrawal of cash from Saving Bank Accounts

Please refer to our circular DCM (Plg) 2905/10.27.00/2016-17 dated January 30, 2017 on the captioned subject.

2. In the wake of withdrawal of Specified Bank Notes (SBNs) since November 09, 2016 Reserve Bank had placed certain limits on cash withdrawals from Savings / Current / Cash credit /Overdraft accounts and withdrawals through ATMs. On a review of the pace of remonetisation, Reserve Bank partially restored status quo ante by removing the restrictions on cash withdrawals from Current / Cash credit / Overdraft accounts and ATMs effective January 31, 2017 and February 01, 2017 respectively. However, the limits on cash withdrawal from Savings Bank accounts continued to be in place.

3. In line with the pace of remonetisation, it has now been decided to remove the restrictions on cash withdrawals from Saving Bank accounts (including accounts opened under PMJDY) in a two step process as under:

• Effective February 20, 2017, the limits on cash withdrawals from the Savings Bank accounts will be enhanced to ₹ 50,000 per week (from the current limit of ₹ 24,000 per week); and
• Effective March 13, 2017, there will be no limits on cash withdrawals from Savings Bank accounts.

4. Please acknowledge receipt.

Yours faithfully,

(P Vijaya Kumar)

Chief General Manager

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RBI Lifts Cash Withdrawal Limits of ATMs, Banks from 01.02.2017

RBI/2016-17/217
DCM (Plg) No. 2905/10.27.00/2016-17 January 30, 2017

The Chairman / Managing Director / Chief Executive Officer,
Public Sector Banks / Private Sector Banks / Foreign Banks,
Regional Rural Banks / Urban Co-operative Banks,
State Co-operative Banks / District Central Co-operative Banks

Dear Sir/Madam,

Limits on Cash withdrawals from Bank accounts and ATMs - Restoration of status quo ante

Please refer to our circular DCM (Plg) No.1226/10.27.00/2016-17 dated November 08, 2016 placing limits on Cash withdrawals from bank accounts and ATMs in the wake of withdrawal of Legal Tender Character of Specified Bank Notes (SBN) and subsequent circulars DCM (Plg) Nos.1256, 1274, 1317, 1437, 2142 and 2559 dated November 11, 14, 21, December 28, 30, 2016 and January 16, 2017 respectively, providing for relief and relaxations therefrom.

2. On a review of the pace of remonitisation, it has been decided to partially restore status quo ante as under:

i. Limits placed vide the circulars cited above on cash withdrawals from Current accounts/ Cash credit accounts/ Overdraft accounts stand withdrawn with immediate effect.

ii. The limits on Savings Bank accounts will continue for the present and are under consideration for withdrawal in the near future.

iii. Limits vide the circulars cited above placed on cash withdrawals from ATMs stand withdrawn from February 01, 2017. However, banks may, at their discretion, have their own operating limits as was the case before November 8, 2016, subject to 2 (ii) above.

3. Further, banks are urged to encourage their constituents to sustain the movement towards digitisation of payments and switching over of payments from cash mode to non-cash mode.

4. Please acknowledge receipt.

Yours faithfully,

(P Vijaya Kumar)

Chief General Manager

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Government Promotes 11 Incentives on Digital Payment and Cashless Economy.

In the aftermath of the cancellation of the legal tender character of old Rs.500 and Rs.1,000 notes, there has been a surge in the digital transactions through use of credit/debit cards and mobile phone applications / e-wallets etc. To further accelerate this process, the Central Government has decided on a package of incentives and measures for promotion of digital and cashless economy in the country.

These incentives/measures are following:

1. The Central Government Petroleum PSUs shall give incentive by offering a discount at the rate of 0.75% of the sale price to consumers on purchase of petrol/diesel if payment is made through digital means.

Nearly 4.5 crore customers buy petrol or diesel at such petrol pumps per day who can take benefit of this incentive scheme. It is estimated that petrol/diesel worth Rs.1800 crore is sold per day to the customers out of which nearly 20% was being paid through digital means. In the month of November 2016 it has increased to 40% and the cash transaction of Rs.360 crore per day have got shifted to cashless transaction methods. The incentive scheme has the potential of shifting at least 30% more customer to digital means which will further reduce the cash requirement of nearly Rs. 2 lakh crore per year at the petrol pumps.

2. To expand digital payment infrastructure in rural areas, the Central Government through NABARD will extend financial support to eligible banks for deployment of 2 POS devices each in 1 Lakh villages with population of less than 10,000. These POS machines are intended to be deployed at primary cooperative societies/milk societies/agricultural input dealers to facilitate agri-related transactions through digital means.

This will benefit farmers of one lakh village covering a total population of nearly 75 crore who will have facility to transact cashlessly in their villages for their agri needs.

3. The Central Government through NABARD will also support Rural Regional Banks and Cooperative Banks to issue “Rupay Kisan Cards” to 4.32 crore Kisan Credit Card holders to enable them to make digital transactions at POS machines/Micro ATMs/ATMs.

4. Railway through its sub urban railway network shall provide incentive by way of discount upto 0.5% to customers for monthly or seasonal tickets from January 1, 2017, if payment is made through digital means.

Nearly 80 lakh passengers use seasonal or monthly ticket on suburban railways, largely in cash, spending worth nearly Rs.2,000 crore per year. As more and more passengers will shift to digital means the cash requirement may get reduced by Rs.1,000 crore per year in near future.

5. All railway passengers buying online ticket shall be given free accidental insurance cover of upto Rs. 10 lakh. Nearly 14 lakh railway passengers are buying tickets everyday out of which 58% tickets are bought online through digital means. It is expected that another 20% passengers may shift to digital payment methods of buying railway tickets. Hence nearly 11 lakh passengers per day will be covered under the accidental insurance scheme.

6. For paid services e.g. catering, accommodation, retiring rooms etc. being offered by railways through its affiliated entities/corporations to the passengers, it will provide a discount of 5% for payment of these services through digital means.

All the passengers travelling on railways availing these services may avail the benefit.

7. Public sector insurance companies will provide incentive, by way of discount or credit, upto 10% of the premium in general insurance policies and 8% in new life policies of Life Insurance Corporation sold through the customer portals, in case payment is made through digital means.

8. The Central Government Departments and Central Public Sector Undertakings will ensure that transactions fee/MDR charges associated with payment through digital means shall not be passed on to the consumers and all such expenses shall be borne by them. State Governments are being advised that the State Governments and its organizations should also consider to  absorb the transaction fee/MDR charges related to digital payment to them and consumer should not be asked to bear it.

9. Public sector banks are advised that merchant should not be required to pay more than Rs. 100 per month as monthly rental for PoS terminals/Micro ATMs/mobile POS from the merchants to bring small merchant on board the digital payment eco system.

Nearly 6.5 lakh machines by Public Sector Banks have been issued to merchants who will be benefitted by the lower rentals and promote digital transactions. With lower rentals, more merchants will install such machines and promote digital transactions.

10. No service tax will be charged on digital transaction charges/MDR for transactions upto Rs.2000 per transaction.

11. For the payment of toll at Toll Plazas on National Highways using RFID card/Fast Tags, a discount of 10% will be available to users in the year 2016-17.

Source: CA Club India

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Interest Rate reduces by RBI on Special Deposit Schemes

Recently, Reserve Bank of India has declared on 12th December, 2014 that the Interest Rate reduces on Special Deposit Scheme 1975 from 8.8% to 8.7%. This reduced interest rate will effect from 01st January, 2014 to 31st December, 2014.  This is great loss of Special Deposit Schemes account holders during the calendar year 2014.

In this connection, we advise that interest for the calendar year 2014 may be promptly disbursed to the SDS account holders @ 8.7% per annum from January 01, 2014 to December 31, 2014 through electronic mode such as ECS/NECS/ NEFT/RTGS or by way of account payee cheques on January 01, 2015 itself, subject to instructions, as applicable, contained in paragraphs 3 and 4 of our circular CO.DT.No.15.01.001/H-3527/2003-04 dated December 30, 2003.

Download Reduces Interest Rates on Special Deposit Schemes (SDS) Click Here.

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Banks remain open for Last Three days with extended hours to facilitate Tax Payments for Fin. Year 2013-14.

With a view to facilitate accounting of all the Government transactions for the current financial year (2013-2014) by March 31, 2014, it has been decided to conduct special clearing at all clearing houses across the country on Saturday, March 29, Sunday, 30 and Monday, 31, 2014 with extended hours till 8.00 PM. Due to this a public holiday of 31st March, 2014 has not been declared as public holiday and on Sunday, March 30, 2014 and on Monday, March, 2014 (at places where holiday under the Negotiable Instruments Act has been declared) agency banks would keep select branches open for transacting government business at locations identified by them based on volume of transactions.  The detailed scheduled is as below:

Earlier Income Tax Department Declared all Income Tax offices remain open on 29th, 30th and 31st March, 2014.

Agency banks doing Government business alone will be permitted to present instruments in the Special Clearing on other participating banks. Other member banks of the Clearing House (including the presenting banks) are required to keep their inward clearing processing infrastructure open during the Special Clearing hours and maintain sufficient balance in their clearing settlement account to meet settlement obligations arising out of the Special Clearing. 

Operating Procedure for tendering instruments through the three CTS grid Centers will be issued separately by the Presidents of the concerned Grid center. 

Member banks of Clearing Houses are advised to adhere to the instructions contained in this circular as well as the instructions received from the Regional offices of Reserve Bank of India and Presidents of respective Clearing Houses. 

Member banks are also advised to be in readiness to participate in the Centralised Payment Systems (RTGS and NEFT) on these days (March 29-31, 2014). A separate broadcast message in this regard will be issued through the respective system indicating the extended time window. 

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Banknotes Pre-2005 series - FAQ's

1. What are the pre-2005 series banknotes?

The RBI issued Mahatma Gandhi series (MG series) 2005 banknotes in the denomination of ` 10, ` 20, ` 50, ` 100, ` 500 and ` 1000. These notes contain some additional / new security features as compared to the 1996 MG series. All banknotes issued before the 2005 MG series are called as pre-2005 series banknotes.

2. How can one distinguish the pre-2005 series banknotes?

Apart from the additional security features, the 2005 MG series banknotes have the year of printing on the reverse of the notes in the lower middle portion. Banknotes printed before 2005 do not have the year of printing on the reverse side and hence can be easily distinguished.

3. Why has RBI decided to withdraw pre-2005 series banknotes?

Reserve Bank of India decided to withdraw from circulation all banknotes issued prior to 2005 as they have fewer security features as compared to banknotes printed after 2005. The withdrawal exercise is in conformity with the standard international practice of not having multiple series of notes in circulation at the same time. The RBI has already been withdrawing these banknotes in a routine manner through banks. It is estimated that the volume of such banknotes (pre-2005) in circulation is not significant enough to impact the general public in a large way and the members of public may exchange the pre- 2005 series banknotes at bank branches at their convenience.

4. Do the pre-2005 series banknotes cease to be legal tender?

The notes issued before 2005 shall continue to be legal tender. The notes are only being withdrawn from circulation and this withdrawal exercise is in conformity with the standard international practice of not having multiple series of notes in circulation at the same time.

5. Can the pre-2005 series banknotes be used for normal transactions?

Members of the public can continue to freely use these notes for their transactions and can unhesitatingly receive these notes in payment, as all such notes continue to remain legal tender.

6. Is there any time limit for exchanging these notes?

These notes can be freely exchanged at any bank branch till January 1, 2015. The procedure to be followed after January 1, 2015, shall be communicated by RBI in due course.

7. How is RBI ensuring that these notes are withdrawn from circulation?

Banks have been advised to stop re-issue of the pre-2005 series notes over the counters/through ATMs and they have been instructed to forward them to the Reserve Bank of India.

8. Is there any restriction on the number of pieces that can be exchanged?

No. There is no such restriction. Banks have been advised to freely exchange these notes till January 1, 2015.

9. Is it necessary to be a customer of the bank to exchange the pre-2005 series notes from its branches?

No. Banks have been advised to freely provide this exchange facility to all members of public, whether customer or non-customer.

10. Is it necessary to get cash in exchange or the amount can be credited in one’s account?

It is not necessary to get cash in exchange for the pre-2005 notes. If a person desires, he can get the amount credited in his bank account.

11. Is there any fee to be paid for the exchange facility?

No. The exchange facility is to be provided free of cost by all bank branches.

Source: www.caclubindia.com

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RBI Extended withdrawal of old Banknotes issued prior to 2005 to 01.01.2015

Reserve Bank of India's Principal Chief General Manager has been issued a notification No. RBI/2013-14/509 DCM(Plg) No.G- 19/3880/10.27.00/2013-14 dated 03.03.2014 regarding withdral of all old series of Banknotes issued prior to 2005 which is as under:
 

RBI/2013-14/509
DCM(Plg) No.G- 19/3880/10.27.00/2013-14

March 03, 2014

The Chairman / Managing Director/ Chief Executive Officer
All Scheduled Commercial Banks
Primary(Urban) Co-operative Banks/RRBs

Dear Sir /Madam

Withdrawal of all old series of Banknotes issued prior to 2005

Please refer to our circular DCM (Plg) No. G-17/3231/10.27.00/2013-14 dated January 23, 2014 on the captioned subject which was followed by a Press Release on January 24, 2014 (copy enclosed).

2. On a review of the matter, it has been decided to extend the date for exchanging the pre-2005 banknotes to January 01, 2015. These instructions have been included in a Press Release dated March 03, 2014 (copy enclosed).

3. You are advised to facilitate the exchange of such notes for full value without causing any inconvenience to the public, whatsoever. These notes will retain their legal tender status and the public can continue to use these for any transaction/ payment.

4. As advised, please issue suitable instructions to all your branches to provide exchange facilities to members of public and to stop re-issue of the pre- 2005 series banknotes. Please also ensure that such notes are not dispensed through the ATMs/ over your counters. The methodology to be followed for dealing with the Pre-2005 series banknotes contained in Para 3 of the circular dated January 23, 2014 referred to above remains unchanged.

5. A list of dos and don’ts, is being enclosed for your guidance.

6. Please acknowledge receipt.

Yours faithfully

(B.P Vijayendra)
Principal Chief General Manager

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Banknotes issued prior to 2005 to be withdrawn: RBI Advisory

The Reserve Bank of India has today advised that after March 31, 2014, it will completely withdraw from circulation all banknotes issued prior to 2005. From April 1, 2014, the public will be required to approach banks for exchanging these notes. Banks will provide exchange facility for these notes until further communication. The Reserve Bank further stated that public can easily identify the notes to be withdrawn as the notes issued before 2005 do not have on them the year of printing on the reverse side. (Please see illustration below)

The Reserve Bank has also clarified that the notes issued before 2005 will continue to be legal tender. This would mean that banks are required to exchange the notes for their customers as well as for non-customers. From July 01, 2014, however,  to exchange more than 10 pieces of `500 and `1000 notes, non-customers will have to furnish proof of identity and residence to the bank branch in which she/he wants to exchange the notes.

The Reserve Bank has appealed to the public not to panic. They are requested to actively co-operate in the withdrawal process.

Ajit Prasad

Assistant General Manager

Press Release : 2013-2014/1472

Download  Press Release Note

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Timely Issue of TDS Certificate to Customers RBI directed to All Banks.

RBI directed to all Urban Co-operative Banks by its notification No. RBI/2013-14/401, UBD.CO.BPD.(PCB).Cir.No. 41/12.05.001/2013-14 December 5, 2013 regarding issuing of TDS Certificate to Customers.   Detail notification is as under:

RBI/2013-14/401
UBD.CO.BPD.(PCB).Cir.No. 41/12.05.001/2013-14

December 5, 2013

To,

The Chief Executive Officer
All Urban Co-operative Banks

Dear Sir / Madam,

Timely Issue of TDS Certificate to Customers

It has been brought to our notice that some banks are not providing TDS Certificate in Form 16A to their customers in time, causing inconvenience to customers in filing income-tax returns in time.

2. With a view to protecting the interests of depositors and for rendering better customer service, urban co-operative banks (UCBs) are advised to provide to their customers from whose deposit accounts income tax has been deducted at source, TDS Certificate in Form 16A. UCBs are also advised to put in place a system that will enable them to provide Form 16A to their customers within the time-frame prescribed under the Income Tax Rules.

3. This advice is issued under Section 36 (1) (a) of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies) (10 of 1949).

Yours faithfully,

(Scenta Joy)
Deputy General Manager

Do you want to exempt from TDS Certificate (Click Here)

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Provide TDS Certificate (Form 16A) to customers in Time - RBI.

Resurve Bank of India asked to banks vide issued a notification No. RBI/2013-14/361 DBOD.No.Leg.BC.65/09.07.005/2013-14 dated 6th November, 2013 regarding issuing of TDS Certificate (Form No. 16A) to their customers from whose Income Tax has been Deducted at Source in due time.  The detailed notification is as under:

RBI/2013-14/361
DBOD.No.Leg.BC.65/09.07.005/2013-14

November 6, 2013

All Scheduled Commercial Banks
(excluding RRBs)

Dear Sir/Madam,

Timely Issue of TDS Certificate to Customers

It has been brought to our notice that, some banks are not providing TDS Certificate in Form 16A to their customers in time, causing inconvenience to customers in filing income-tax returns timely.

2. The matter has been examined and with a view to protect interest of the depositors and for rendering better customer service, banks are advised to provide to their customers from whose income tax has been deducted at source, TDS Certificate in Form 16A. Banks are advised to put in place systems that will enable them to provide Form 16A to the customers within the time-frame prescribed under the Income Tax Rules. Banks should avoid waiting till the last moment.

3. This advice is issued under Section 36 (1) (a) of the Banking Regulation Act, 1949 (10 of 1949).

Yours faithfully,

(Rajesh Verma)
Chief General Manager

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Cash withdrawals at POS upto Rs. 1000.00 Daily.

RBI has issue a notification regarding Cash Withdrawal on POS instruments on prepaid cards.  This facility was available only on Debit Cards.  For more information the following notification must read.

RBI/2013-14/231
DPSS.CO.PD.No.563/02.14.003/2013-14

September 5, 2013

The Chairman and Managing Director / Chief Executive Officers
All Scheduled Commercial Banks including RRBs /
Urban Co-operative Banks / State Co-operative Banks /
District Central Co-operative Banks /All Card Network Providers

Madam / Dear Sir,

Cash withdrawal at Point of Sale (POS) - Prepaid Payment Instruments issued by banks

A reference is invited to our circular DPSS.CO.PD.No. 147 /02.14.003/2009-10 dated July 22, 2009 permitting cash withdrawal at Point of Sale (POS) by all debit cards issued in India upto Rs.1000/- per day,  subject to certain conditions.

2. The open system prepaid payment instruments (PPIs) issued by banks is perceived to be a subset of debit cards. Hence, on a review of the position, it has been decided that the facility of cash withdrawal at POS with debit cards may be extended to such open system prepaid payment instruments issued by banks in India. The limit of cash withdrawal will remain Rs.1000/- per day subject to the same conditions as applicable hitherto to debit cards.

3. This circular is being issued in exercise of the powers conferred on the Reserve Bank under Section 18 of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007).

Yours faithfully,

(Vijay Chugh)
Chief General Manager

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Payment of pension to the Central Government pensioners-RBI

RESERVE BANK OF INDIA 

www.rbi.org.in

Ref. DGBA.GAD No. H-7386/45.01.001/2012-13

The Chairman / Managing Director 

State Bank of India & its Associates Banks 

Chairman & Managing Director 

All Nationalised Banks & IDBI 

Bank Ltd. 

ICICI Bank Ltd, Axis Bank Ltd, HDFC Bank Ltd.

Dear Sir,

Payment of pension to the Central Government pensioners – Continuation of either or survivor pension account after death of a pensioner

We have been receiving complaints from the pensioners that on death of a pensioner, banks are insisting on opening of a fresh account by the widow/widower  of the pensioner for the purpose of family pension.

2. In this connection, we advise that in case the spouse (Family pensioner) opts for existing joint account for credit of family pension, banks should not insist on opening of a new account when the spouse is the survivor and having a joint account with the pensioner and in whose favour an authorization fo payment of family pension exists in the Pension Payment Order (PPO).

3. We advise you to issue suitable instructions to your Regional Offices/branches authorised to disburse pension to the Central Government pensioners.

Yours faithfully, 

sd/- 

(Satyapal Unni) 

Assistant General Manager

Endt.DGBA.No.H.7387/45.01.001/2012-13 of date

Copy forwarded for information to

1. the Controller General of Accounts, Government of India, Ministry of Finance,  Department of Expenditure, Office of the Controller General of Accounts, 7th Floor, Lok Nayak Bhavan, Khan Market, New Delhi-110 511  with reference to his letter No.T-14018/31/2011/TA-III/279 dated May 17, 2013.

2. the Controller General of Defence Accounts, Government of India,  Ministry of Defence West Block-V, R K Puram, New Delhi -110 066 with reference to his letter No. AT/CC/P-Offrs/R-109/04/11 dated June 27, 2011

3. the Director, Finance (A), Government of India, Ministry of Railways, (Railway Board), New Delhi, with reference to his letter No.2011/AC-II/21/2 dated My 11, 2011

4. the Director (TAl), Government of India, Ministry of Communications, Departmentof Telecommunications, Sanchar Bhavan, New Delhi 110 001 with reference to his letter No 6-138/1990-TA-l/Vol-Vll/606 dated May 4. 2011.

5. the Chief Controller (Pensions), Government of India, Ministry of Finance, Department of Expenditure, Central Pension Accounting Office, Trikoot 2, Bikaji Cama Place, New Delhi 110 066 with reference to his letter No.CPAO/Tech/Misc/2010-11/345 dated May 4, 2011.

6. the Director (Budget and Admn, ), Ministry of Communications & IT, Department of Posts, Government of India, PA Wing: PEA branch, Dak Bhavan, Sansad Marg, New Delhi-110 001

7. the Regional Director/General Manger, Reserve Bank of India, Public Accounts Department, Ahmedabad / Bangalore / Bhubaneswar / Belapur / Bhopal / Chandigarh / Chennai / Kolkata / Guwahati / Hyderabad / Jaipur/ Kanpur / Mumbai /New Delhi / Nagpur / Patna /Thiwvananthpuram

8. the Chief General Manager, Reserve Bank of India, Customer Service Department. CO 1st Floor, Amar Building, Sir P.M Road. Mumbai 400001

9. All Banking Ombudsmen.

(S.K.Vasave)

Manager

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Disbursement of Pension by Agency Banks

RBI/2013-14/101
DGBA.GAD.No.H- 4/31.05.001/2013-14

July 1, 2013

All Agency Banks
Dear Sir/Madam

Master Circular- Disbursement of Pension by Agency Banks

Please refer to our master circular RBI/2012-13/103 dated July 02, 2012 on the above subject. We have now updated the master circular incorporating important instructions issued by us till end of June 2013. A copy of the same is enclosed for your information. This circular may also be downloaded from our website www.mastercirculars.rbi.org.in.

2. Please acknowledge receipt.

Yours faithfully

(B.K.Mishra)
Chief General Manager

Encl: As above

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Stop writing on Currency Notes - RBI

Clean Note Policy

In recent periods, instances of certain branches of banks continues to follow old practices like stapling, writing number of note pieces in loose packets on watermark window of notes disfiguring the watermark impression and rendering it difficult for easy recognition have come to our notice. Further, it has also been observed that certain bank branches do not sort notes into re-issuables and non-issuables, and issue soiled notes to public. Such practices are against the “Clean Note Policy” of Reserve Bank of India.

2. In this connection we invite a reference to Reserve Bank of India’s Directive DBOD No. Dir. BC. 43/13.03.00/2001-02 dated November 7, 2001 and reiterate that:

    a) banks should do away with stapling of any note packet and instead secure note packets with paper bands,

    b) banks should sort notes into re-issuables and non-issuables, and issue only clean notes to public; and,

    c) banks should forthwith stop writing of any kind on watermark window of bank notes.

Download Full Notification

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PPF Scheme & Senior Citizens Saving Scheme - Interest Rates w.e.f. 01.04.2013

RBI has issued a notification bearing RBI/2012-13/458, DGBA.CDD. No. H- 5603 /15.02.001/2012-13 dated March 28, 2013 regarding revision of Interest on the PPF Scheme and SCSS-2004.  The RBI further notified as per followings:

Public Provident Fund Scheme, 1968 (PPF, 1968) and
Senior Citizens Savings Scheme, 2004 (SCSS, 2004) - Revision of interest rates

Please refer to our circular RBI/2011-12/359 dated January 20, 2012 regarding interest rates on small savings schemes, wherein it was indicated that as per Government’s decision on revision of interest on small savings schemes, the interest rates on various small savings schemes for every financial year will be notified by the Government before April 01st of that year.

2. The Government of India has now vide their Office Memorandum (OM) No. 6-1/2011-NS.II (Pt.) dated March 25, 2013, advised the rate of interest on various small savings schemes for the financial year 2013-14. Accordingly, the rates of interest on PPF, 1968 and SCSS, 2004 for the financial year 2013-14, effective from April 01, 2013, on the basis of the interest compounding/payment built-in in the schemes, will be as under:

Scheme	Rate of Interest w.e.f. 01.04.2012	Rate of Interest w.e.f. 01.04.2013
5 year SCSS, 2004	9.3% p.a	9.2% p.a
PPF, 1968	8.8% p.a	8.7% p.a

3. The contents of this circular may be brought to the notice of the branches of your bank operating the PPF, 1968 and SCSS, 2004 schemes. These should also be displayed on the notice boards of your branches for information of the PPF, 1968 & SCSS, 2004 subscribers.

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All banks clearing remain open on 29, 30 & 31 March, 13 - RBI

Due to heavy rush of Income Tax, Sales Tax, Service Tax Challan, Transfer of Payment RBI decided to open all banks for clearing on March 29,30 and 31, 2013.  In this regard Reserve Bank of India issued a notification which is as under:

RBI/2012-13/454
DPSS.CO.CHD.No./1674/ 03.01.03/2012-2013

March 21, 2013

The Chairman and Managing Director / Chief Executive Officer
All Scheduled Commercial Banks including RRBs /
Urban Co-operative Banks / State Co-operative Banks /
District Central Co-operative Banks/Local Area Banks

Madam / Dear sir,

Clearing operations on March 29, 30 and 31, 2013

With a view to facilitate accounting of all the Government transactions for the current financial year (2012-2013) by March 31, 2013, it has been decided to conduct special clearing at all clearing houses across the country on March 29, 30 and 31, 2013 as detailed below:

Date	Type of clearing	Presentation clearing	Return clearing
March 29, 2013 (Friday)	Locations where the day is a holiday under Negotiable Instruments Act 1881- A Special Clearing with same day return clearing	One hour after the extended business hours keeping in view the operational convenience at the local center	Half an hour/One hour after the presentation clearing or as per the operational convenience at the local center.
	Locations where the day is a working day	Normal clearing operations as is followed on any normal working day
March 30, 2013 (Saturday)	Normal Clearing as followed on any working Saturday
	In addition, a Special Clearing for credit to Government accounts only	One hour after the extended business hours keeping in view the operational convenience at the local center	Half an hour/One hour after the presentation clearing or as per the operational convenience at the local center
March 31, 2013 (Sunday)	A Special Clearing for credit to Government accounts only.	One hour after the extended business hours keeping in view the operational convenience at the local center	Half an hour/One hour after the presentation clearing or as per the operational convenience at the local center

2. Agency banks doing Government business alone will be permitted to present instruments in the Special Clearing on other participating banks. Other member banks of the Clearing House (including the presenting banks) are required to keep their inward clearing processing infrastructure open during the Special Clearing hours and maintain sufficient balance in their clearing settlement account to meet settlement obligations arising out of the Special Clearing.

3. In this regard, a reference is invited to the circular issued by our Department of Government and Bank Accounts (DGBA.GAD.No. H.5486/ 42.01.029 / 2012-13 dated March 21, 2013) on ‘Annual Closing of Government Accounts - Transactions of Central / State Governments - Special Measures for the Current Financial Year (2012-13).

4. Member banks of Clearing Houses are advised to adhere to the instructions contained in this circular as well as the instructions received from the Regional offices of Reserve Bank of India and Presidents of respective Clearing Houses.

5. Member banks are also advised to be in readiness to participate in the Centralised Payment Systems (RTGS and NEFT) on March 29, 2013 and March 31, 2013. A separate broadcast message in this regard will be issued through the respective system.

Yours faithfully
(Vijay Chugh)
Chief General Manager

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For International Transactions Chip Base Credit Card applicable-RBI

Payments effected through alternate payment products/channels are gaining traction among the customers, with more and more banks providing such facilities to their customers. In this scenario, it is imperative to ensure safety and security of such transactions effected through these channels.

Of late, there have been reports of frauds committed through the electronic payment channels and fraudulent usage of cards both at domestic and international locations. Even while the frauds reported are not alarming compared to the total transactions effected through these channels, RBI, has proactively engaged with the stakeholders to ensure the security of such transactions. One such initiative taken earlier was the mandating of additional factor of authentication for all card not present (CNP) transactions. Measures for security of card present (CP) transactions have also been initiated by RBI through the implementation of recommendations of the Working Group on Securing Card Present transactions.

With cyber-attacks becoming more unpredictable, and fraudsters moving to new methods, banks are required to put in place certain minimum checks and balances to minimise the impact of such attacks and to arrest/mitigate the damage. However, in order to ensure that customers of banks are not vulnerable to such attacks, RBI has today issued new guidelines to the stakeholders to further strengthen the security and risk mitigation measures of cards and electronic banking transactions.

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RBI New Gold Deposit Scheme

Gold Deposit Scheme

The Central Government, with a view to bringing privately held stock of gold in circulation, reduce the country’s reliance on import of gold and providing its owners with some income apart from freeing them from the problems of storage, movement and security of gold in their possession, had notified Gold Deposit Scheme 1999 on September 14, 1999. Accordingly, Reserve Bank of India vide circular No IBS 912/23.67.001/99-2000 dated October 5, 1999 had formulated guidelines for Gold Deposit Scheme to enable banks authorized to deal in gold to prepare their own Gold Deposit Schemes.

2. The Central Government (Department of Financial Services, Ministry of Finance) has now issued a Notification No.G.S.R.46(E) dated January 24, 2013 (copy enclosed) enabling Mutual Funds/Exchange Traded Funds registered under SEBI (Mutual Fund) Regulations to deposit part of their gold with the banks under the scheme.

3. In view of the above, the guidelines enclosed with our circular dated October 5, 1999 for operation of the Gold Deposit Scheme have been modified as under:

• Under para 5, presently the banks may either issue a passbook/statement of account or a certificate/bond to the depositors for deposit of gold, which will be transferable by endorsement and delivery.  In terms of the Government Notification dated January 24, 2013, the Gold Certificate would also mean the final receipt, in dematerialised form or otherwise, issued to a subscriber of the Scheme after the gold tendered by him has been assayed as specified in para (ii) below and accepted as deposit by the bank. The gold deposit certificate shall be transferable by endorsement and delivery, as hitherto. However, in case of certificates issued in dematerialized form, the depository rules for transfer would apply.
• Under para 6 it is stated that there will be a preliminary assay to ascertain gold content/caratage in jewellery by a non-destructive technique such as X-Ray/karat meter followed by a fool-proof method like fire assay.  It has now been decided that the exception from fire assay / destructive assay will be provided for physical Gold tendered by Mutual Funds/ Gold Exchange Traded Funds approved by SEBI and complying with the Good delivery norms of the London Bullion Market Association (LBMA) having a fineness of 995.0 parts per thousand accompanied by a certificate acceptable to the designated bank.
• Under para 7, the Resident Indians (Individuals, HUF, Trusts, Companies) may invest in the scheme. In terms of the Government Notification dated January 24, 2013 referred to above, a Trust including Mutual Funds/Exchange Traded Funds registered under SEBI (Mutual Fund) Regulations may deposit under the scheme.
• Para 12 states that the deposits may be made available within a maturity range from three to seven years.  It has now been decided to change the maturity period, of gold deposits, ranging from six months to seven years.
• Para 22 mandates that details of the scheme designed date from which it will be operational and the branches from which it will be operated, may be advised by the banks proposing to introduce a gold deposit scheme to RBI for obtaining its approval.  It has now been decided that authorised banks would not be required to obtain prior approval of RBI for introducing the scheme. Banks should, however, inform the details of the scheme including names of branches operating the scheme to RBI. Banks would be required to report the gold mobilised under the scheme by all branches in a consolidated manner on a monthly basis in the revised format (copy enclosed).

4. Other guidelines enclosed with the above mentioned circular, as amended from time to time, will remain unchanged.

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Bank Finance for the Purchase of Gold and Advances against Gold

Today on 06th Feb. 2013 RBI had issued circular vide No. RBI/2012-13/411 UBD.BPD.(PCB) Cir No.36/13.05.001/2012-13 regarding Bank Finance for Purchase of Gold.  Read below circular for clarification.

Bank Finance for Purchase of Gold

Please refer to our circular UBD.PCB.Cir.No 24/13.05.001/08-09 dated November 10, 2008 on ‘Advances against Pledge of Gold / silver ornaments’ advising UCBs to observe certain safeguards while granting loan against pledge of gold/ silver ornaments.

2. In terms of announcements made in paragraph 102 and 103 (extract enclosed) of the Second Quarter Review of Monetary Policy 2012-13 on October 30, 2012, the significant rise in import of gold in recent years is a cause of concern as direct bank financing for purchase of gold in any form viz., bullion/primary gold/jewellery /gold coin etc would lead to fuelling of demand of gold for speculative purposes. It was therefore proposed that other than working capital finance, banks would not be permitted to finance purchase of gold in any form.

3. As you are aware, presently UCBs are permitted to grant loans against pledge of gold ornaments, but not permitted to grant any advance for purchase of gold in any form. In view of the concerns mentioned in para 2 above, it is reiterated that UCBs should not grant any advance for purchase of gold in any form, including primary gold, gold bullion, gold jewellery, gold coins, units of gold Exchange Traded Funds (ETF) and units of gold Mutual Funds.

4. We have been receiving references from UCBs enquiring whether loans against gold ornaments availed by small borrowers could be classified as priority sector advances. In this connection it is clarified that the purpose of the loans and/or the loan amount sanctioned are the criteria for classification as priority sector advances and not the security for the loan.

For example, loans to small traders or small businessmen are essentially in the nature of working capital loan given primarily against the hypothecation of goods they deal with and therefore loan against gold jewellery to small businessmen may not necessarily be for undertaking trade or business.

5. Please acknowledge receipt of this circular to the Regional office concerned.

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RBI amendment RTGS system with NG-RTGS from April.

Adoption of ISO 20022 messaging standard in Next Generation RTGS (NG-RTGS) system
 

In the Second Quarter Review of Monetary Policy 2011-12 it was announced that the NG-RTGS system would be developed using extensible markup language (XML) messages conforming to ISO 20022 standards.
 

2. Accordingly, a Working Group with members from select banks, IDRBT, NPCI and CCIL and RBI was constituted in May 2012 to identify the business requirements, examine the technical feasibility of adopting the ISO 20022 compliant message formats. The message formats suggested by the Working Group were validated by ISO Standards Certification Authority as being compliant with ISO 20022 standards. The Working Group also examined the timeframe that would be required by the various stakeholders for adopting of the ISO 20022 message formats and suggested a time frame of three months for implementation.
 

3. In view of the above, it has since been decided to adopt these message formats for the proposed NG-RTGS system which would replace the existing RTGS system. The ISO 20022 compliant message formats for the NG-RTGS system are available on the RBI website under http://rbidocs.rbi.org.in/rdocs/RTGS/PDFs/RTGISO20022.pdf. You are advised to download the same and ensure that the infrastructure at your end enables handling of the ISO message formats by March 31, 2013.

4. The Reserve Bank would be conducting awareness and training workshops for RTGS members for the NG RTGS system. A separate communication in this regard will be sent by our Department of Information Technology.
 

5. As stated in Para 3, all RTGS members will have to be ready by March 31, 2013 with the technical capabilities to handle ISO 20022 message format to participate in NG-RTGS system. Please acknowledge receipt and confirm initiating necessary action within 7 days of receipt of this letter.

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