RBI To Provide Liquidity Facility To Make NEFT System 24x7

The Reserve Bank of India (RBI) has decided to provide an additional collateralised intra-day liquidity facility for smooth operation of National Electronic Funds Transfer (NEFT) payment system on a round-the-clock basis from December 16, the central bank said.

The move will help the payment system to become operational on a 24x7 basis.

The facility is used to electronically transfer funds of banks which are members of this system from one account to another.

"... In order to facilitate smooth settlement of NEFT transactions in the accounts of the member banks maintained with the Reserve Bank in a 24x7 environment, it has been decided to provide an additional collateralised intra-day liquidity facility, to be called Liquidity Support (LS)," RBI said in a notification.

"The LS facility will be available for facilitating NEFT settlements on 24x7 basis. The LS facility will operate as per the same terms and conditions as the Intra-Day Liquidity (IDL) facility," the notification said.