The Hindu Business Line : Payment and settlement system board very soon

Mr V. Leeladhar (left), Deputy Governor, RBI, and Mr Vepa Kamesam, Ex-Chairman, IDRBT, at the Banking Technology Conference in Mumbai on Thursday - - Paul Noronha

Mumbai , Feb. 10

THE RBI Deputy Governor, Mr V. Leeladhar, today said that the proposed Board for Payment and Settlement Systems would be set up in the next few weeks.

Talking to reporters at the sidelines of a banking technology seminar organised by the Indian Banks Association, here today, Mr Leeladhar said the board would function as an autonomous body.

A vision document for 2005-08 released by the Reserve Bank of India earlier suggested hiving off of the `negotiated dealing system' from the RBI and the central bank establishing a national settlement system.

It was also suggested that the central bank should offload its clearing operations to a separate legal entity and focus on being a settlement institution for all clearing systems, apart from its regulatory and supervisory functions.

Mr Leeladhar said about 500 banking centres are expected to be linked with the Real Time Gross Settlement (RTGS) system by the end of March.

Responding to a question on merger of co-operative banks, he said co-operative banks should first get the clearance from the Registrar of Co-operative Societies for acquisition of another banks.

On February 2, the RBI had issued guidelines to facilitate mergers and acquisitions among urban banks, especially of weak UCBs with financially strong urban cooperative banks.

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