What changed
Previously, Public Sector Banks had a different remittance timeline for e-payments into government accounts. Based on a Committee recommendation by the Controller General of Accounts, the RBI has now mandated a uniform T+1 working day norm for PSBs, matching the existing requirement for Private Sector Banks.
What it means for you
PSBs must accelerate their internal processes to ensure government e-payments are credited within one working day, reducing float and improving government cash management. This levels the playing field with private banks and may require system upgrades or process changes to meet the tighter deadline.
What you must do
- Update internal systems and procedures to remit all government e-payments within T+1 working day effective November 1, 2010.
- Train operations staff on the new timeline and ensure compliance monitoring.
- Coordinate with treasury and IT teams to automate remittance workflows if not already in place.
- Review any existing agreements with government departments to align with the revised norm.
Who it affects
Public Sector Banks (State Bank of India and associates, nationalised banks, Jammu & Kashmir Bank), Government treasury and accounting departments, Bank operations and IT teams handling e-payments
What does T+1 working day mean in this context?
It means the remittance must be completed within one working day after the transaction date, including the day the payment is put through. For example, if an e-payment is processed on Monday, the funds must reach the government account by Tuesday.
Does this apply to all government transactions or only e-payments?
This circular specifically applies to all government transactions made through e-payments. Other modes of payment may have different timelines.
When does this new norm take effect?
The revised remittance period is effective from November 1, 2010. Banks must ensure compliance from that date onward.