Delays in overseas funds? RBI changes aim to speed up cross-border inward payments

New Delhi: The Reserve Bank of India (RBI) has issued fresh guidelines to accelerate cross-border inward payments in India, directing banks to streamline processes so that funds sent from abroad are credited to beneficiaries more quickly.

In a circular to all scheduled commercial banks, the central bank said the move is aimed at improving the efficiency of international money transfers to India and aligning with global benchmarks under the G20 cross-border payments roadmap.

RBI payments Vision 2025 targets faster, cheaper global transfers

The RBI said its Payments Vision 2025 focuses on making cross-border payments faster, cheaper, more transparent, and accessible, in line with G20 targets.

“The Reserve Bank's Payments Vision 2025 aims to bring efficiency in cross-border payments, aligning with the G20 roadmap… for achieving cheaper, faster, more transparent, and more accessible cross-border payments,” the central bank said.

Delay in beneficiary bank credit flagged

The RBI highlighted that delays in inward remittances often occur at the beneficiary bank stage — the time taken between receipt of funds and credit to the customer’s account.

Following a review, the central bank stressed the need for streamlined banking processes to ensure faster credit of funds and timely communication to customers.

Banks have now been directed to immediately inform customers upon receipt of cross-border payment messages. If such messages are received after banking hours, customers must be notified at the start of the next business day.

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Faster reconciliation of Nostro accounts mandated

The RBI also identified delays caused by reliance on end-of-day reconciliation of Nostro accounts — accounts held by domestic banks with foreign banks in foreign currency.

To address this, banks have been advised to carry out frequent reconciliation of Nostro accounts, ideally on a near real-time basis or at regular intervals not exceeding one hour.

“Banks shall endeavour to credit the inward payments received during foreign exchange market hours within the same business day,” the RBI said.

Push for straight-through processing and digital interfaces

To further speed up foreign remittances to India, the central bank has allowed banks to introduce straight-through processing (STP) for crediting funds to resident individuals, subject to risk assessment and compliance with FEMA regulations.

Additionally, banks have been encouraged to roll out digital platforms for forex transactions, enabling customers to submit documents, track inward remittances, and monitor transaction status seamlessly.

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Implementation timeline

The RBI said the new cross-border payment guidelines will come into effect six months from the date of the circular, giving banks time to upgrade systems and processes.

The move is expected to significantly improve the speed and transparency of international fund transfers to India, benefiting individuals and businesses receiving money from overseas.

ANI