Page 49 - Banking Finance January 2018

RBI CIRCULAR

tain cases (for Funds and Agency Commis- should settle their agency transaction hereafter with
RBI directly. The new arrangement for settlement of
sion) directly from Reserve Bank of India
state government funds on day to day basis (receipts
RBI/2017-18/107 and payments) directly with Reserve Bank will be with
effect from January 1, 2018. Thereby, all agency
DGBA.GBD.No-1498/31.02.007/2017-18
commission claims beginning with the quarter ending
March 31, 2018 will be settled directly with the
1. As per the existing arrangements in certain states, in
certain cases, some agency banks are routing their concerned Regional Office of Reserve Bank of India.
agency transactions of state governments through Yours faithfully
another agency bank, that acts as an aggregator, that (D. J. Babu)
in turn settles these agency transactions with
concerned Regional Office of RBI for both receipts and Reporting of Transactions by agency
payments. In such scenario, both agency bank acting
as aggregator and other agency bank share the eligible banks to RBI
agency commission on such transactions.
RBI/2017-18/103
2. In the age of prevailing Core Banking Solutions/e-
DGBA.GBD.1472/31.02.007/2017-18
banking systems in all the agency banks, Reserve Bank
is committed to provide fast, efficient and secure 1. It has been brought to our notice that some agency banks
banking facility to the State Governments by are reporting government transactions after considerable
implementation of standardised e-receipts and e- delay and along with the current transactions to RBI,
payments with its CBS (e-Kuber), enabling RBI to act without taking necessary authorisation from the
as single point of contact for settling state government concerned government departments.
funds (receipts/payment). This will also facilitate better 2. As per the extant instructions, state government
cash management by the State Governments. transactions (electronic as well as in physical mode) of
3. Therefore, on review, it has been decided that all previous month reported after 8th of the succeeding
agency banks should settle their agency transactions month and those pertaining to earlier months should
for both funds and agency commission directly with the be reported to RBI through a separate statement for
concerned Regional Office of Reserve Bank instead of accounting, after being confirmed by the competent
routing them through any other agency bank that acts authorities of concerned state government.
as aggregator in certain cases. It effectively makes all 3. It has now been decided that, for Central Government
agency banks to report government receipts directly transactions (electronic as well as in physical mode), if
to RBI instead of reporting them through any other the transactions or any adjustments thereof are
agency bank. So also for payments made by all agency reported after a gap of 90 days from the date of
banks on behalf of state government/s get directly transaction, agency banks have to obtain prior approval
settled with the concerned Regional Office of RBI. from concerned ministry/department and submit the
Agency Transaction details/scrolls may be sent directly same to RBI separately at the time of reporting such
by individual agency bank to the concerned State transactions for settlement.
Government/Treasury. This arrangement is expected to
4. It may be noted that all instructions related to the
improve management of State Government funds apart
from reducing inefficiencies in the system. timeline to be adhered to, for reporting of government
transactions, remain unchanged.
4. Agency Banks that are already settling their state
government transactions with RBI directly may Yours faithfully
continue to do so. Agency Banks that are hither to (Partha Choudhuri)
settling their transactions with other aggregator General Manager
agency bank may stop such reporting. Such banks

BANKING FINANCE | JANUARY | 2018 | 49

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