RTGS for corporates kicks off

Real time gross settlement (RTGS) transactions for corporate customers triggered off today with a total of 24 transactions aggregating about Rs 80 crore.

Standard Chartered Bank (SCB) executed the first customer RTGS deal of the day for Hindustan Lever Ltd (HLL) with State Bank of India (SBI) being the receiving bank. The amount was for Rs 10 crore.

SCB executed 10 transactions worth Rs 75 crore for its corporate clients including a deal for Hindustan Petrochemical Ltd (HPCL).

The other three banks "" SBI, HDFC Bank and Saraswat Bank "" also executed a number of transactions for their clients. HDFC Bank concluded around eight customer transactions for over Rs 10 crore involving HLL, Grasim, Indian Oil Corporation and a leading stock broking firm, said sources.

RTGS transactions will help corporates settle payments instantaneously and manage their working capital requirements more effectively, said Standard Chartered Bank regional head global markets (India & Nepal) M A Ravi Kumar.

"This will mean good savings since for every Rs 1 crore payment made the following day, a corporate will save about Rs 2,100 if his account is credited immediately taking eight per cent interest on working capital," he added.

SCB will charge a minimum fee of Rs 250 and a maximum fee of Rs 2,500 for every corporate transaction. The fee structure levied at 0.025 per cent of the transaction value will depend upon the business relationship and size of the transaction, said Kumar.

With the implementation of RTGS, India has joined the world's developed economies in establishing a domestic payments platform that would eliminate settlement risk, said Standard Chartered Bank Plc group head (client relationships-wholesale banking) Jaspal Bhindra.

IndusInd will go live tomorrow with its Indus AIM (anywhere instant money) for inter-bank RTGS transactions. RTGS went live on March 26 for inter-bank transactions among the four banks "" SCB, SBI, HDFC Bank and Saraswat Bank.

In the next six to nine months all the banks in various phases would become part of the RTGS system, which today is restricted to a few banks and operational only within Mumbai.