RBI announces another On-Tap liquidity Window, 24*7 Automated Clearing
The RBI has issued a statement to announce 24*7 direct benefit transfers, and another on-tap liquidity window of Rs 15,000 crore.
National Automated Clearing House (NACH)
NACH is a bulk payment system which NPCI operates. It facilitates one-to-many credit transfers, such as payment of dividend, interest, salary, pension, as well as collection of repetitive payments like electricity, telephones, mutual funds investments, etc. It has also emerged as a popular and prominent digital mode of direct transfer of government subsidies to a large number of beneficiaries.
NACH was only available on bank days earlier. However, it will be available 27*7, taking advantage of the 365 days availability of RTGS. Round the week operations will be effective from August 1, 2021.
On-tap liquidity window for contact-intensive sectors
The RBI had decided to open an on-tap liquidity window of Rs. 50, 000 crore with tenors of up to three years at the repo rate till March 31, 2022. The decision was aimed at boosting immediate liquidity for ramping up COVID-related healthcare infrastructure and services in the country.
The Central Bank has now decided to open a separate liquidity window of Rs 15,000 crore for certain contact-intensive sectors such as hotels and restaurants, tourism, aviation ancilliary services, transport, etc. The tenor will once again be of up to three years at the repo rate.
Under the scheme, the RBI expects banks to create a separate COVID loan book. Such banks will be eligible to park their surplus liquidity up to the size of the COVID loan book, with the RBI under the reverse repo window at a rate which is 25 bps lower than the repo rate or, termed in a different way, 40 bps higher than the reverse repo rate. Banks desirous of deploying their own resources without availing funds from the RBI under the scheme for lending to the specified segments mentioned above will also be eligible for this incentive.
You may read the full statement here.
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