Which of the following is the correct pairing of a payment system with the body that operates it?
- A.RTGS - National Payments Corporation of India
- B.NEFT - Indian Banks Association
- C.NACH - National Payments Corporation of India
- D.UPI - Reserve Bank of India
Correct answer
Explanation
The correct answer is C, NACH and the National Payments Corporation of India. The National Automated Clearing House is a bulk clearing service of that corporation, used for repeated credits such as salary, pension, dividend and subsidy and for repeated debits such as loan instalments and utility bills. Option A is wrong because RTGS is operated by the Reserve Bank of India itself. Option B is wrong because NEFT is also operated by the Reserve Bank; the Indian Banks Association only helped promote the corporation and runs no payment system of its own. Option D is wrong because UPI belongs to the National Payments Corporation of India, not to the Reserve Bank, although the Reserve Bank regulates it like every other system. The safe rule is that the Reserve Bank runs exactly two of the systems named in this topic, RTGS and NEFT, and the corporation runs the rest.
Read the full article: Payment Systems in India: NEFT, RTGS and IMPS Notes
Practice Questions
View allWhat is the minimum amount that can be remitted through RTGS?
- A.Ten thousand rupees
- B.One lakh rupees
- C.Two lakh rupees
- D.Five lakh rupees
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RTGS is meant for large value payments, and the Reserve Bank has fixed a floor of two lakh rupees for a remittance through it, while setting no ceiling of its own on the amount.
Read the full explanation →NEFT stands for:
- A.National Electronic Funds Transfer
- B.New Electronic Fund Transaction
- C.National Exchange of Funds and Transfers
- D.Net Electronic Financial Transfer
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NEFT is the nationwide system operated by the Reserve Bank of India for transferring funds from one bank account to another, settled on a deferred net basis in half hourly batches and available on all days of the year since December 2019.
Read the full explanation →In which payment system is each transaction settled individually and in real time, without being grouped into batches?
- A.NEFT
- B.RTGS
- C.NACH
- D.Cheque Truncation System
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The words in the name say it: real time means the instruction is carried out as it is received, and gross settlement means each instruction is settled by itself rather than set off against others.
Read the full explanation →The Immediate Payment Service (IMPS) is operated by:
- A.The Reserve Bank of India
- B.The State Bank of India
- C.The National Payments Corporation of India
- D.The Indian Banks Association
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IMPS was launched by that organisation in 2010 and was the first Indian system to offer interbank transfer instantly at any hour, including Sundays and holidays.
Read the full explanation →How is a NEFT transaction settled?
- A.Individually, the moment it is received
- B.On a deferred net basis, in half hourly batches
- C.Only at the end of the working day
- D.Only after the beneficiary bank confirms it
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NEFT holds instructions for a short period, works out what each bank owes the others on balance, and settles only that difference; the batches run every half hour through all twenty four hours, since the service was made available on all days of the year in December 2019.
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