How RBI’s proposed new charge system will most likely be utterly totally different from UPI, NEFT, RTGS

The need for lightweight charge and settlement system (LPSS)

The central monetary establishment acknowledged that this charge system could be operated from anyplace by a unadorned minimal staff to have the ability to be able to face extreme circumstances equal to pure calamities and battle, and may very well be made energetic solely on a necessity basis.

The new system will add to the rich bouquet of charge platforms throughout the nation and can most likely be made obtainable on a “need basis”, said Sachin Castelino, Chief Strategy & Transformation Officer, In Solutions Global LTD.

The system will leverage advanced technology to enable secure and guaranteed digital payments in times of calamities, added Sachin.

Alternative to RTGS, UPI, NEFT?

The LPSS, which will operate independently of existing payment systems like RTGS, NEFT, and UPI, aims to provide a portable and resilient solution during natural calamities and wartime situations.

This would process transactions that are critical to ensure the stability of the economy such as government and market-related transactions.

Real-time gross settlement (RTGS), National Electronic Fund Transfer (NEFT), and Unified Payments Interface (UPI) are dependent on complex wired networks backed by advanced IT infrastructure. “However, catastrophic events like pure calamities and battle have the potential to render these charge packages shortly unavailable by disrupting the underlying knowledge and communication infrastructure,” the report from RBI said.

By conceptualizing the LPSS, the central bank aims to ensure the availability of essential payment services and maintain economic stability in extreme and volatile situations, said Amit Gupta, MD, SAG Infotech.

“This system’s infrastructure will most likely be unbiased of the experience that powers totally different charge packages along with RTGS, NEFT, and UPI. The lightweight and moveable charge system would solely be activated “as needed,” primarily based on RBI, and it may very well be meant to run on elementary {{hardware}} and software program program,” acknowledged Vinit Khandare, CEO and Founder, MyFundBazaar.

Through these initiatives, the RBI objectives to strengthen the safety, effectivity, and trustworthiness of charge packages in India, guaranteeing their resilience and continuity even throughout the face of utmost circumstances.

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Updated: 01 Jun 2023, 12:51 PM IST

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