Rbi To Set Up Wing To Mentor Payment Systems

The Reserve Bank of India (RBI) is set to create a new department for monitoring domestic payment systems and facilitate their orderly growth, said RBI deputy governor Y V Reddy.

This follows RBI's recent moves to ban banking access for 23 terrorist organisations and tighten the gates for money laundering. A centralised department will be the nodal point to check misuse of the system.

Meanwhile, the real-time gross settlement system through the Clearing Corporation of India Ltd (CCIL), which was expected to start by December 2001, is delayed.

According to a CCIL official, the system is likely to roll out by mid-February. At present, CCIL is testing its links with RBI's servers. In the government securities market, trading at present is being done largely over the telephone.

 

Meanwhile, a top RBI official said that the central bank is not comfortable with huge private placements being done by Indian corporates as these involve less transparency compared to public issues.

"Private placement is too private for RBI's comfort," he said. In 2000-01, there were Rs 69,500 crore of debt papers placed privately compared with only Rs 6,421 crore raised through public issues.