25. RBI releases draft circular on Guidelines to facilitate faster cross-border inward payments

The Reserve Bank of India (RBI) has, vide its circular dated October 29, 2025, released the draft Guidelines to facilitate faster cross-border inward payments (Draft Circular), in order to bring efficiency in cross-border payments and to make them cheaper, faster, more transparent, and more accessible. The Draft Circular states that the speed of cross-border payments is affected by several factors. One of these factors affecting the speed of cross-border payments is the delay at the beneficiary leg i.e., the time taken from receipt of the payment at the beneficiary bank till credit 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.

The key guidelines published by the RBI include inter alia the following:

1. Banks shall inform their customer of the receipt of cross-border inward transactions immediately on receipt of inward message. Messages received after close of operating hours of the individual banks shall be informed to the customer immediately at the start of the next business day.

2. It is observed that several banks rely upon end-of-day statements of the nostro account for confirming and reconciling receipts in nostro accounts, resulting in delayed 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.

3. Banks shall endeavor 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.

4. 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.

5. Banks may, within a reasonable time frame, endeavor to provide digital interface to their customers to facilitate foreign exchange transactions, including submission of documents or information, and monitoring of transactions.

The above directions shall be effective six months from the date of publication of the Draft Circular.