RBI Announces Moves To Enhance Scope Of UPI, Bharat Bill Payment System


UPI users will soon be able to separate and block funds in their accounts for specific use cases, according to a regulatory announcement from the Reserve Bank of India.

The addition will let a user create a single block of funds in their account that can be debited as needed, RBI governor Shaktikanta Das said during his speech following the monetary policy committee meeting. “This will significantly enhance the ease of making payments for investments in securities, including through the Retail Direct platform as well as e-commerce transactions,” he said.

The central bank has also decided to expand the use cases for the Bharat Bill Payment System.

While largely limited to one-time payments for utilities or other similar services, BBPS will now cover all categories of payments and collections, including recurring payments. Currently, BBPS does not cater to payments such as education fees, tax payments, and rent collections for individuals, even if they are recurring in nature.

All such payments will be enabled for both individual and business users, further expanding the reach of BBPS, the governor noted in his statement.

Breathing room

RBI has also decided to allow Indian residents to hedge their exposure to gold price risk overseas.

Although resident individuals and firms were earlier prohibited from doing so, the RBI’s move will allow them to hedge the risk on regulated exchanges located in IFSC Gift City in Gujarat, the governor said in a statement.

“This measure will benefit importers/exporters of gold, such as jewellers and industries that use gold as an intermediate or raw material,” governor Das said.

The governor also announced that the enhanced held-to-maturity limits on banks under SLR will stay in effect till March 2024. Following which, the limit will be reduced from 23% to 19.5% by June 2024.

Banks will be allowed to include securities acquired between Sept. 1, 2020 and March 31, 2024 under the enhanced limited, the governor said.

“The HTM limits would be restored from 23% to 19.5% in a phased manner starting from the quarter ending June 30, 2024,” he added.


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