What changed
RBI observed that NECS branch growth lags behind NEFT, despite similar system requirements. Banks are now advised to prioritize bringing all CBS-enabled branches already on NEFT under NECS/RECS and submit a time-bound plan.
What it means for you
Banks must accelerate NECS/RECS onboarding for all CBS branches, especially those already live on NEFT. This will increase operational load on IT and CBS teams but ensures uniform pan-India ECS benefits for customers. Non-compliance may invite regulatory scrutiny.
What you must do
- Identify all CBS-enabled branches not yet on NECS/RECS, starting with those already on NEFT.
- Draw up a time-bound plan for full branch coverage and submit it to RBI.
- Coordinate with National Clearing Cell, RBI Mumbai for guidance if needed.
- Monitor progress to close the gap between NEFT and NECS branch counts.
Who it affects
All NECS participant banks, IT and CBS operations teams, Branch operations and clearing departments
Why does RBI want banks to prioritize NEFT-enabled branches for NECS?
Because NEFT and NECS both rely on CBS for straight-through processing, so branches already on NEFT have the technical capability to join NECS without major additional investment.
What happens if a bank does not submit a time-bound plan?
RBI has advised banks to submit a plan under advice to them. While no penalty is specified in this circular, non-compliance may lead to regulatory follow-up or escalation.