What changed
RBI has mandated LEI for all payment transactions of ₹50 crore and above by non-individuals using RTGS and NEFT, effective April 1, 2021. Banks must ensure remitter and beneficiary LEI information is included in payment messages and maintain records of such transactions.
What it means for you
Banks need to update their RTGS and NEFT messaging systems to capture LEI in specified fields (e.g., 'Remittance information' for RTGS, 'Sender to Receiver Information' for NEFT). This enhances transparency and risk management for large-value payments, aligning with global standards. Non-compliance could lead to operational disruptions for high-value transactions.
What you must do
- Advise all non-individual customers transacting ₹50 crore or more via RTGS/NEFT to obtain LEI from LEIL or other GLEIF-accredited LOUs.
- Update RTGS and NEFT message formats to include remitter and beneficiary LEI in the specified fields.
- Maintain records of all transactions of ₹50 crore and above through RTGS and/or NEFT.
- Communicate technical guidelines for LEI population to relevant teams once issued by RBI.
Who it affects
Member banks participating in RTGS/NEFT, Non-individual customers (corporates, firms, etc.) making or receiving large-value payments, Legal Entity Identifier India Ltd. (LEIL) as the local LEI issuer
What is the threshold for LEI requirement in RTGS/NEFT?
The LEI is mandatory for all payment transactions of ₹50 crore and above undertaken by non-individual entities using RTGS or NEFT.
Where should LEI be included in RTGS and NEFT messages?
For RTGS, LEI goes in the 'Remittance information' field. For NEFT outward debit messages, it goes in the 'Sender to Receiver Information' field.
From when is this mandate effective?
The directions are effective from April 1, 2021.