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RBI Mandates Faster Inward Remittance Credits
10 Apr
Summary
- Banks must credit remittances same business day.
- India is the world's largest receiver of remittances.
- New rules aim to speed up payment processing times.
The Reserve Bank of India (RBI) has mandated that banks must credit inward remittances to beneficiary accounts on the same business day. This new directive aims to accelerate cross-border payment processing, a significant departure from the current scenario where less than 10% of remittances are credited within an hour.
Banks have a six-month grace period to implement this same-day credit requirement. Concurrently, they must also reconcile and confirm credits in their nostro accounts on a near real-time basis, or at intervals not exceeding 30 minutes. Customers will be immediately notified upon receipt of cross-border payment messages, with those received after business hours to be communicated the following business day.
These measures come as India continues to be the world's largest recipient of remittances, with over $135 billion expected in 2025. These funds are crucial for managing external sector risks and supporting consumption demand across various states, often surpassing foreign direct investment.
