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Electronic Fund Transfer And Clearing System:
The Indian Banking Association has been busy.
Having launched the Electronic Fund Transfer
(EFT) and the Electronic Clearing System (ECS)
among member banks, customers were looking
forward to catching up with the time-is-money
culture in more ways than way. Here is a look
at what gives and the many-a-slip-'tween cup-and-lip
even as domestic banks spruce up their act.
Electronic Fund Transfer:
Unlike Swadhan, this is a system that IBA
offers that is better-applied and waiting
for appreciation. EFT is probably the safest
and fastest way to transfer money from your
account to another individual in another city
regardless of which bank she uses.
All the transferor needs is her account number.
A maximum of Rs0.1mn can be transferred for a flat
fee of Rs25. The bank has discretionary powers to
raise the limit for select customers. Or a customer
can break up the transactions in to multiples of
upto Rs0.1mn. The money sent is credited overnight
and can be withdrawn by the receiver the day after
The hitch, it is not well known and secondly,
the facility is only available in the four metros!
Plus, money sent from abroad cannot be transferred
through EFT.Disclosing other advantages of the
EFT, an official of the IBA's department of information
technology, says, "The facility can be availed
of even if the branch from where you are sending
the amount is not fully computerized.
The details of the transfer have to be sent to
the RBI which in turn notifies the receiving bank
to credit the individual with the mentioned amount."Most
bank officials agree that publicizing and marketing
these facilities should be a priority since many
customers are used to old methods of transaction:
telegraphic machinery or by the cheques.
|Electronic Clearing System :
mind the vagaries of the stock market. For those
who are and will always make equity investments
a way of life the ECS has made that life a lot easier
as far as dividend payments go. All a person has
to do is provide the company with details about
the bank where the deposits should be made. The
firm can then directly deposit the dividends into
the shareholder's account. The maximum that a company
can deposit is Rs0.1mn, though here too, the bank
has the discretion to raise that ceiling.
Apart from being a free service, from four metros
the facility can now be availed of in 15 cities
(those that have regional RBI offices) including
Ahmedabad, Pune, Thiruvananthapuram and Nashik.
This geographical spread, lacking in the EFT, has
led to the increasing popularity of ECS. By one
estimate, the volume of transactions has increased
this year. Last year, the IBA recorded Rs2.3mn through
ECS; this year upto now the transactions have already
touched over Rs4mn. What stymies growth is the number
of firms that use ECS. At present the facility is
available with 65 Indian companies, so check if
your investible companies are on this list.
word of caution. Despite assurances of speed and
safety, there have been complaints of delays in
transfers to accounts. To ensure that the money
has been credited, check account statements at regular
its not that IBA's intentions are not honorable.
If only the infrastructure was in place, real-time
banking off-hours would be available to the loyal
customers. On par with the rest.
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