RBI issues draft rules to speed up cross-border payments

The Reserve Bank of India has released a draft circular to make cross-border inward payments faster and smoother. It aims to reduce delays in crediting money to beneficiaries once funds reach the bank. The RBI has asked banks to share their feedback on the draft by November 19, 2025.

The speed of cross-border payments is affected by several factors. One of these factors is the delay at the beneficiary leg, i.e., the time from receipt of the payment at the beneficiary bank until it is credited to the beneficiary account. Streamlining the processes at the beneficiary bank would ensure timely intimation of payment information and credit to the beneficiary’s account.

Accordingly, the central bank suggests that banks inform their customers of the receipt of cross-border inward transactions immediately upon receipt of the inward message. Messages received after the individual banks' operating hours shall be communicated to the customer immediately at the start of the next business day.

The RBI also noted that several banks rely on end-of-day statements for their nostro accounts to confirm and reconcile receipts, thereby delaying credit. "To expedite this process, banks are advised to undertake reconciliation and confirmation of credit in the nostro account either on a near real-time basis or at periodic intervals. The reconciliation interval should normally not exceed thirty minutes," per the RBI circular.

"Banks shall endeavour to credit the inward payments received during the foreign exchange market hours within the same business day to the beneficiary’s account, and credit the inward payments received after market hours on the next business day, subject to compliance with the extant FEMA and other regulatory requirements," stated RBI in its circular.

RBI suggested that banks provide a digital interface for their customers to facilitate foreign exchange transactions, including document submission and transaction monitoring.

"Banks may, based on their risk assessment and subject to compliance with extant FEMA guidelines, put in place a straight-through process for crediting inward payments to the account of individual residents," per the RBI circular.