MUMBAI, February 6: The woes of delay in fund flow across bank branches has come a step closer to becoming a thing of the past. The Reserve Bank of India (RBI), early this week, successfully conducted trial runs of the electronic-fund transfer (EFT) scheme, which enables credit and debit from accounts through the electronic mode in less than three days.The massive exercise launched by the apex bank was in force from Monday to Thursday. It involved all the 27 public-sector banks and took place at their branches in the four metros.
According to RBI sources, the response to the trial runs, which involved a live parallel fund flow along with the physical fund transfer, was quite encouraging with most banks reporting satisfactory handling of the facility.
"In each metro, at least 10 large banks took part in the exercise. They had the choice of opting for the city depending on the strength of their branch network. However, all 27 PSU banks were involved in the process in some form or the other," said an RBIsource.
"We have, however, decided to obtain a more detailed feedback from the banks on their experience with the facility. A review meeting will be held next week. If the response remains good, then we would be hopeful to kick off the exercise across the four metros by mid-March," said the source.
Banking sources said the trial runs were carried out on transactions of amounts less than Rs 1 lakh. "For a start, the amount has been pegged at a low level. This would be extended once the review is through," said a source. Sources add banks are expected to charge Rs 10 per transaction, which would be much lower than the prevailing rates. "Once the system is in place, the transfer of funds from one account to another would take less than three days from one metro to another," said a source with a PSU bank.
Even though the move is expected to benefit people across the board, it will have a special impact on the market community where delays in transfer of funds has been a major obstacle to growth.
"A bulkof the market activity takes place from the four metros. These account for more than 80 per cent of the business. Once the EFT is installed across the PSU banks, there will be a much faster fund flow, which would enable investors to receive their money on time," said the National Stock Exchange (NSE) managing director RH Patil.
Patil said that with the depository system in place, the problems associated with the transfer of paper would be taken care of. The other major problem of eliminating delays in fund flow would also be eliminated, he added.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
