Digitization of Payment System

Bangladesh Bank introduced several modes of Inter-bank payment

An Overview on the
Through Instrument: BACPS
payment & settlement systems
Through Instruction: BEFTN
of bangladesh Through Mobile Account: MFS
Through Card/online Based Payment: NPSB
Through instruction, time-critical fund: RTGS

BACPS & BEFTN operation has been upgraded to BACH-II on 24.10.2019

PSD of Bank Asia handles BACPS, BEFTN and RTGS

Payment service department

PSD PSD – a brief introduction

 PSD is the most vibrant and automated department of Bank
Keeping automation and Green Banking in mind, Asia carrying mission flag and values by incorporating
technology driven innovative services and product
prioritising technology driven innovative services, opportunities for its customers very successfully since 2009.
PSD tagline is
 Bank Asia has been equipped with Bangladesh Automated
Clearing House (BACH) system since October 07, 2010,
which allows paperless cheque clearing.
Protected Systematic Disciplined
 Gradually, PSD introduced BEFTN on February 28, 2011
All INWARD operations handled by PSD centrally, while branches run the and RTGS on October 29, 2015.
OUTWARD operations under PSD monitoring and technical support.
 MICR Unit started operation in August 24, 2009.

Payment service department Payment service department

 4 Units of PSD Statistics
1. Bangladesh Automated Clearing House, BACH
This unit works for all branches of Bank Asia dealing with clearing cheques receive and payment including In Bangladesh, average daily transaction of all Banks is:
other bulk payments & settlements i.e. dividend warrant, refund warrant etc.
2. Bangladesh Electronic Fund Transfer Network, BEFTN
BACPS : 1,02,000 value Tk. 10,000 crore
This unit enables all BA clients including Agent Banking, Islamic Window, Credit Card and channelizing BEFTN : 1,00,000 value Tk. 675 crore
remittance for the beneficiaries, as well as for revenue enhancement by online fund transfer and bulk
payments i.e. Dividend warrant, Salary payments etc.
3. Real Time Gross Settlement, RTGS
This unit offers the fastest, popular and world class fund transfer service, now available for all Bank Asia Bank Asia average daily transaction is:
customers.
4. Magnetic Ink Character Recognition, MICR BACPS : 6,900 value Tk. 479 crore
This unit arranges printing & delivering MICR instruments i.e. SB & CD Cheque books, PO, DD, Card
cheques etc. to all customers of Bank Asia, including Islamic Windows, Agent Banking and Cards BEFTN : 14,500 value Tk. 47 crore
Department, smoothly and securely and generating revenue for the Bank over the years.
RTGS : 471 value Tk. 87 crore
PSD takes pride as Bank Asia originated the first ever RTGS transaction on 29.10.2015.

Bank Asia also originated the first BACH transaction as well as the first BEFTN transaction in the upgraded Apart from this, PSD provides daily approximately 30,000 MICR cheque
BACH-II operation on 24.10.2019. leaves to all Branches, Agent Banking, Islami Wings, Credit Card etc.

Payment service department Payment service department

BACH Overview Types of Transaction

 Prior to the introduction of BACH, the entire payment system of BACPS: Bangladesh Automated Cheque Processing System
Bangladesh was conducted manually among all financial
institutions through ‘Nikash’ software. 1. Outward Regular Value (OCE-RV)
Any amount cheque can be placed through RV
 To modernize the countries payment system the Department of 2. Outward High Value (OCE-HV)
Currency Management & Payment Systems (CMPSD) of Only Five Lacs and above value cheque
Bangladesh Bank officially started its operations of BACH CLEARING SESSIONS
(Bangladesh Automated Clearing House) on October 7th, 2010
TYPE Presentment Cut Off Return/Settlement
Four types of work sources are used in BACH High Value Clearing(HV) 11.30 am 3.00 pm
 Outward Cheque Envelope (OCE)
 Inward Cheque Envelope (ICE)
Regular Value Clearing(RV) 12.00 pm 5.00 pm
 Outward Return Cheque Envelope (ORE) Timing is exclusively handled by BB according to their server schedule.
 Inward Return Cheque Envelope (IRE)
In BACH-II, BB will not extend time upon participating bank request.

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BACH Process Flow
Types of Clearing instruments
Tr. code Tr. type
10 Savings Bank Account Cheque
11 Current Account Cheque
12 Banker’s Cheque

MICR/Chq 13 Cash Credit Account Cheque

processing 14 Dividend Warrant

Server 15 Demand Draft

16 Gift Cheque

17 Interest Warrant

18 Refund Warrant
19 Pay Order
20 Credit Card Cheque
PBM Server 23 Foreign Taka Demand draft

31 Pre-audited Govt. Cheque

32 Post-audited Govt. Cheque

Payment service department Payment service department

Types of FC Clearing Instruments 29 Return Reasons used in BACH

As a part of BACH upgradation, named BACH-II, BB is going to include FC Cheque ID REASON DESCRIPTION ID REASON DESCRIPTION
and FC Demand Draft in Automated Clearing. 01 Insufficient Fund  14 Item sent to wrong bank or branch
02 Amount in figure and word differs  15 Account closed or dormant or blocked
Primarily 5 currencies are selected for operation.
03 Stale Cheque 16 Advice not received 
04 Post Dated or Undated Cheque 17 Duplicate item- previously paid
Tr. code Name of Tr. code Name of 05 Drawers signature differs or missing 18 Incorrect payee (mismatch with advice)
19 High value item presented to an ineligible branch
Instrument Instrument 06
07
Payment stopped by drawer
Item represented too often, more than 3 times
20 Cheque not activated/intimation not received
21 Cheque and advice data mismatch
61 USD Cheque 71 USD Demand Draft 08 Incomplete or missing endorsement
22 7 (seven) days notice required
62 GBP Cheque 72 GBP Demand Draft 09 Forged endorsement
23 Test key required or differs
63 Euro Cheque 73 Euro Demand Draft Material alteration- payee name or amount or 24 Not arranged for or Credit limit exceeded
10
date or account no  25 Revenue stamp required or not sufficient
64 JPY Cheque 74 JPY Demand Draft 11 Forged or unauthorized signature 26 Signature and seal required on the stamp
65 CAD Cheque 75 CAD Demand Draft 12 Missing corporate stamp  27 Budget required or refer to the issuer
13 Incorrect amount, cheque, account number 28 Item required revalidation
MICR Demand Drafts have been made available to all AD Branches. 29 MICR data and Image mis-matched
Whenever, Bangladesh Bank starts FC Clearing operation, Bank Asia branches will be PSD has implemented automation to deduct charge if Inward Cheque is returned for  marked reasons,
able to take part instantly. Return Charge is Tk. 100 + VAT for SB Accounts
Tk. 200 + VAT for CD and SND Accounts.

Payment service department Payment service department

 Select Scanner & Cheque Scan
BACH Charge Schedule
Charge Schedule incurred through Bangladesh Automated
Clearing House with effect from March 01, 2013
Amount Amount

Type Tk. 5,00,000 & above Tk. 50,000 to below 5,00,000

HV Charge 60 Tk. (50+10) X
RV Charge 25 Tk. (20+5) 10 Tk. (8+2)

Charge amount is VAT inclusive.

Charge amount is shared between Bangladesh Bank and Presenting Bank.
Presenting Bank can waiver only their portion of charge, BB portion must be paid by bank.
PSD has implemented automation to deduct charge from a/c during presentment.

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Batch No. and Amount Outward Maker Form

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 Outward Checker Form Outward Exception Report

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Outward Exception Samples

Causes for Exception

Payment service department

 Inward Return Charge Report
Inward Return Charge Report Module

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Inward Transaction Profile Report

REPORT
Outward Report
Branch wise Outward MKR/CKR Status
Outward Exception
Branch wise outward details status

Outward return Report

Branch wise outward return (IRe) details

Inward Report
Branchwise Inward MKR CKR Status
Inward transaction profile

Inward return Report

Branch wise outward return (ORE) details
Payment service department
 Inward Maker Form Inward Checker Form

Inward Checker handled by PSD Centrally.

Inward Maker handled by PSD Centrally.
Payment service department Payment service department

Non MICR Cheque

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 Fraud & Forgery of MICR instruments Main types of cheque fraud
Fraud or Forgery is an aspect of corruption.  Counterfeit - cheques not written or authorized by account holder.
 Corruption threats businesses, economic development of nation and
moral development of individuals.  Forged - Stolen cheque not signed by account holder, signature is
forged.
Fraud occurs for the weakness of  Altered - an item, issued by the account holder, has been
 Banking policy, intercepted and the payee/amount/date has been altered.
 Bankers’ poor knowledge of operation,
 Carelessness,
 Inadequate electronic security etc. Here comes the Role of automation; BACH:
 Banker must know how to detect fake note or fraud check. Minimize the movement of physical cheque.
MICR reader in cash counter & scanning of instrument restricts
 The simplest type of fraud is cheque theft, where the criminal steals cheque from post fraudulent attempts.
office, business deals, another person; then uses them to make purchases doing
signature forgery. UV activated to detect invisible alteration of cheque.
 Criminals also use forgery by alteration of cheque value. Say, cheque is for BDT. 100,
that is altered to BDT 10,000 value cheque by adding simply 2 zeroes. Inclusion of 6 strong security measure in MICR instrument.

Payment service department Payment service department

Cheque Fraud Preventive Measures

Types of Cheque Fraud :
Original Cheque leaf stolen
 Cheque fraud by stealing and from the customer by Knowledge is Protection for a Banker.
en-cashing -hidden access to customer, relative/ employee. To prevent Fraud and Forgery, Bankers should have knowledge.
PO/tax authority. Alteration in payee name,
 Fraud by alteration in important areas of chq serial no., amount, account,  KYC : Know Your Customer
cheque & and even both in MICR line and in
the body of the cheque Documents, Integration, acknowledgment, ID check
Fraud by duplicate presentment/  KYE: Know Your Employee
unauthorized deposits Behaviors and observation
 Exploit the system (when operates both Mostly done by banker
either accidentally or intentionally  KYP: Know Your Process
Manual & auto)
Manual, Training, Practice & Participation
 Impersonation and Cheque discounting :
 KYT: Know Your Transactions
scam operate by obtaining ID & personal With or without concern of banker or
information. by IT expert fraudster TP, Queries, Positive Pay notice
 KYI: Know your Instrument
 Duplicate Cheque
Duplicate printing of cheque done by the Standard specification of BACH instruments
Customer / employee of cheque Printer /
relative or employee of the customer
Payment service department Payment service department
 Know your Customer Know your Process
Know your Employee Know your Transaction
Outward:
 Details and Accurate Information  How to receive : Check under UV light, place crossing, check TP, ask source.
 Oversee the transactions of account  Endorsement, Title matching, Credit proper Account
 Issue balance confirmation & get feedback  Put proper stamps and signatures
 Test call on Mobile /telephone number  Submit in Maker/checker system in BACH Module.
 Correct Data Entry  Know about presentment and return cut of time in HV & RV.
 Update KYC
 Update Transaction Profile Inward
 Include proper Risk grading  Know payment delegation & rights of honor /return and impact of business
 Match with Cheque serial, signature matching, payment instruction matching,
positive pay confirmation & matching, TP matching etc.
 Aware about collogues, his behavior pattern and honesty
 Before return: Intimation to customer, Follow timeline, put return reason
 Not to over-trust or over depend on anybody
properly etc.

Payment service department Payment service department

Know your Instrument MICR Image

 Types of Bank Asia Cheque: SB, CD, Card, Islamic etc.
 Behavior practice of UV machine
 Knowledge about cheque : designs of cheque leaf
 Use of UV machine/ Scanner
 Know 4 corners
 Balancing of physical instrument etc.

 Essential 6 characteristics of MICR cheque

I. 95 GSM CBS-1 Paper
II. With Microprints : carefully watch the lines
III. With watermark : can be seen by placing over the UV lamp/sunlight
IV. With magnetic ink : automatically data read by MICR reader /scanner
V. With erasable ink : in the background, if suspicious use of eraser
VI. With invisible ink : UV fluorescent, check with UV lamp, check for violation

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 Security Features of BA Cheque Micro Print & QR Code
Image taken
Lot No in Bar Code for Vender detection

from Zoomed
Unique SL for Vendor tracking

Micro Print Line

Erasable ink in surface bluish color

Invisible Ink all over cheque

Vendor Logo Water Mark

Screenshot of
Bank Asia Cheque Additional features
QR Code containing A/c details
Alpha-numeric Unique Sl
QR Code
Unique Sl for Vendor Tracking

Bleed through Hammering Technology in MICR line

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Invisible ink Cheque - UV MICR Line Details

Place the cheque in the UV Scanner, and observe
District Branch
Bank Code Code
Code
070 27 535 7
9 digit Routing no.

MICR line

7 digit chq. serial no. 13 digit debit A/C no.

0000068 0000334009382 2 digit tr, code

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 MICR Information in Cheque Cheque Overleaf

Cell: 01231 123 123

Masud Anwar
Cheque Information Captured by Machine
Cheque Routing Cheque Account Transaction Amount Sequence Number
No Number Number Code (Back side of instrument)
Presenting Bank Info
Area used by the Area used by Area for Machine .
9474080 215274247 0001511432201 11 210273882 00000001 250216
Depositor Presenting Bank Endorsement

Payment service department Payment service department

Four Corners checking Responsibility for Protection

 Fraud & forgery may occur
 While payment is made or
 In course of Cheque collection/deposits

 In case of payment: cheque placed by mutilation, alteration

 In case of deposit: fraudulent instrument receipt/false
Outward Checking: Inward Checking: transfer/false credit
Confirm Amount matches in word and figure Confirm Amount matches in word and figure
Confirm Cheque is not post or stale dated Confirm Cheque is not post or stale dated
Confirm Signature is put Confirm Amount matches with TP
Confirm UV, MICR, alteration Confirm Signature matches with SS Card Both Presenting Bank and Payee Bank have some
Confirm Prima Facie genuineness Confirm Operational Instruction
Confirm Depositor account accuracy
responsibilities to prevent Fraudulent attempts.

Payment service department Payment service department

 Presenting Bank’s Responsibilities
Presenting Bank preventives Section 5 of BACPS Operation Rules & Procedures

BACH settlement is done on the basis of image and data.  As per the BACPS Operating Rules and Procedures Presenting Banks are responsible for:
Presenting bank will be held guilty of negligence because black & white image fails to enable
Paying bank to ensure genuineness of cheque  Should comply to the BACPS rules,
 Send approved Payment Items to the Clearing House ( non MICR instruments, items drawn on the

Conducting due diligence is responsibility of presenting bank to: bank branches those are closed for special reason are non eligible)

 Enforce KYC in system and practice properly

 Prevent disclosure of any security procedures offered by BB.
 Extra Care for New Accounts
 Certifies that the front and Back image are of copies of the original negotiable instrument, and
 Verify prima facie genuineness of cheque, due diligence agrees to indemnify BB for any loss/expenses incurred due to non compliance & negligent of
 apparent tenor of instrument presenting bank,
 physical feel of instrument  Should be responsible to verify the Prima Facie genuineness of the presented item.
 any tampering visible to the naked eye with reasonable care  Should store the original instrument in organized manner and ensure its security. On Request of
 Use of UV detectors & other fake detection techniques the paying bank will produce the original document within 7 working days.

 Attempt to detect fraud, forgery or tampering apparent on the face of the instrument
 Failure in producing the original item to the paying bank will end in non payment of that item by
 Employ suitable risk management techniques the paying bank.
 scrutiny of high value transactions  Credit the proceed of cheque to the customers A/C on immediately after settlement.
 limit based checking by officials

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Payee Bank preventives Significant Lapses

Check with security measures before pay For Customer:
 Check TP/OP Instruction  Keep cheque book in unsafe place
 Pay through Maker and Checker  Share personal info with others
 Transaction honour/return within cutoff time  Do not check A/C regularly (SMS, Internet Banking, Statement)

Ensure Positive Pay received from the client as per PSD Circular For Banker:
04/2013, Date 26/11/2013
 Signature missing/erroneous in SS card/ not scanned properly
Positive Pay Instruction by Account Holder is Mandatory for
Tk. 1.00 lac & above (for corporate/Proprietorship)  Operation instruction mismatch
Tk. 5.00 lac & above (for individual)  TP not updated
 Fake address
In case of non availability of PPI, the cheque may be returned by  Balance confirmation/welcome letter procedure not followed
showing the cause “advice not received”.  Cheque handed over without entry etc.

Payment service department Payment service department

 Positive Payment Ins. Fraud P.O Ins. Fraud

Signature Absent in Stelar Module

Operation Instruction mismatch

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 Deliver PO without signature
Deliver PO without signature or posting

Payment service department

PO posted with wrong amount Cheque tampering

Payment service department Payment service department

 Sample Fraud Prevented by PSD in 2016
Value 3 Crore Taka Only Alteration Chq

Payment service department

Operational Tips Checklist : Branch supervisor shall ensure

Outward Related:  Ensure use of UV detector both at cash counter and
 Carefully check Cheques containing overwriting and alterations,
 If the instrument is not machine readable over three digits, do not process. If presentment of BACH.
necessary, place with Caution Notice to payee bank.
 Cheque of suspicious customer’s accounts
 Details report of presentment in BACH, Exception
 Process instruments after receiving cheques from customers report or bounced report from e-MICR module, honor
 Select secured storage mechanism for collected or settled cheques
 Cleaning all the respective folders in the FTP poll and PBM out folder everyday
and return report from stellar and reconciliation sheet
after end of operation on daily basis
 Match CPS and PBM reports and reconcile at day end
 Ensure entry of Depositor, Pay name & A/C no
Inward Related:  Obtains ‘Positive pay’ from customer and inform PSD
 Check all relevant information : date, amount, signature, availability of
fund , issuance of cheque  Put Telephone No. in Signature Card
 Check email to ensure there is no Stop Payment request
 Match CPS and PBM reports for ICE and IRE
 Update SS card in system for any change
 Clean respective folders in FTP poll & PBM everyday after operation

Payment service department Payment service department

 Caution for Cash Cheque Recap - BACH Obligations
As Presenting Bank, for OUTWARD:
01. Compulsory use of UV scanner to detect fraud, forgery or tampering
Before payment, check the instrument under UV light 02. Compulsory use of MICR scanner to read MICR data (manual intervention discouraged)
Ensure there is no erasing, rewriting & alteration Otherwise, presenting bank will be held guilty of negligence.
Write proper denominations of payment of cheque
Ensure proper use of MICR scanner As Receiving Bank, for INWARD:
Recipients signature taken at overleaf properly Ensure Positive Pay received from the client as per PSD Circular 04/2013, 26/11/2013
Positive Pay Instruction by Account Holder is Mandatory for
Careful about payment if account appears irregular Tk. 1.00 lac & above (for corporate/Proprietorship)
Tk. 5.00 lac & above (for individual)
Carefully assign & Rotate duties of the receipts and payment officers In case of non availability of PPI,
frequently Examine cash with register while change of shift the cheque may be returned as “advice not received”.
Entry and check late receipts/payment register
Check cash with Vault and Affairs Settle through ‘Stop Payment’:
If any branch receives any ‘Stop Payment’ mail from PSD, branch will
1. Immediately block the amount in client account
2. Send IBCA to PSD according to mail at the earliest
END OF BACPS

Payment service department Payment service department

BEFTN Overview BEFTN characteristics

 BEFTN – Bangladesh Electronic Fund Transfer Network  Highly reliable & efficient nationwide fund transfer system
 Network governed by BB
 BEFTN went live on 28th Feb,2011.  Potential fund transfer tool for single, multiple & bulk
 Bank Asia used software is called DigiPay. transfers
 Maximum transactions are related to Foreign Remittance.  Can send to different destination A/cs in different banks
 It is based on instruction and Settlement is done on deferred payment basis.
 Return time is 4 hours from receipts of Credit entry.
 Return time is 4 hours from receipts of Debit entry.  In BACPS, a cheque is always a debit instrument.
 Previously, return time was 48 and 24 hours respectively for credit and debit entry.
 But, EFT transactions can be of 2 types:
PSD single day record is 30,000+ transactions for Outward  Credit Transaction &
500,000+ transactions for Inward  Debit Transaction.

Payment service department Payment service department

 Credit & Debit BEFTN Participants involved in BEFTN
 EFT is an instruction of fund transfer entry to specific  Originator : Customer, through cheque account only, gives
counterpart account over his bank or service provider. instruction to execute the transaction.
 This may either be a Credit or a Debit instruction  Originating Bank (OB) : Bank who originates the EFT
If the receiver account is debited, then the entry is an EFT debit.
If the receiver account is credited, then the entry is an EFT credit.
transaction or execute on behalf of his customer.
 Bangladesh Electronic Fund Transfer Network : BEFTN
Basic document of two type EFT transactions : operator/ Bangladesh Bank.
1) EFT Credit- can be initiated by simple BEFTN authorization  Receiving Bank (RB) : Bank that receives the payment
form.
2) EFT Debit - needs a frame agreement with ultimate receiver to
instruction to respond the transaction.
keep in record for debit origination.  Receiver : The ultimate Beneficiary/instruction receiver’s
account.
Bangladesh Bank has made BEFTN transaction charge free.

Payment service department Payment service department

BEFTN credit Transaction flow BEFTN Credit

 EFT credit entries occur when an Originator initiates a transfer to move funds into
BB a Receivers account.
For example, when a corporate client uses the payroll service at a bank to pay the
salary of its employees, the corporate originates the payment through the OB to
OB RB transfer the money into the accounts of the employees.

 EFT credit transactions involve both consumer and corporate payments with
EFT Operator separate rules and regulations for each.
 The most typical consumer EFT application is Direct Deposit of Payroll.

Some EFT Credit Applications

 Foreign Remittances
 Dividends/Interest/Refunds of IPO
 Business to Business payments (B2B)
 Payroll - private and government
 Government vendor payments
Originator Receiver  Customer-initiated transactions

Payment service department 67

Payment service department
 BEFTN Debit BEFTN Advantages
 In an EFT debit transaction, funds flow in the opposite direction. Advantage to Consumers
 Elimination of time and cost in procuring/depositing cheques
 Funds are collected from the Receiver‘s account and transferred to an Originator‘s  Consistent availability of funds on a timely basis
account, even though the originator initiates the entry.  Elimination of possibility of loss or stolen cheque

 Utility company can initiate an EFT entry to collect bill from the consumers. Advantage to Companies
 Reduction of clerical cost for cheque issuance/cash disbursement
 Elimination of time lost by employees in depositing cheque
Some EFT Debit Application  Eliminate cheque procurement costs
 Better cash management/ forecasting
 Utility bill payments  Elimination of possibility of loss or stolen cheque
 Installment of loans
 Insurance Premium Advantage to Banks
 Mortgage/Loan installment payments  Reduction of costs through automated processing
 Club/Association subscriptions  New opportunities for increased business : New services
 Chittagong Stock Exchange Payments  Public recognition through innovative payment services
 Alleviation of teller-line and customer-desk congestion during peak periods

Payment service department Payment service department

Users of BEFTN and authority of service Few Fundamentals of BA EFTN

 Savings, Current and STD nature customers including  Payment Service Department, Branches, Islami Windows, FRD,
Islamic windows and Agent Banking customers are the Agent Banking can execute an EFT transaction.
ultimate user of EFT service .  Corporate customers, if allowed online banking, can also initiate
EFT entry.
 This service is available at Net Banking.
 ALL branches, SMEs, other operation departments like PSD,
Remittance, Agent Banking, FIFLD (former EBEK) and
Credit Card Department use the service tools independently  HoB & MoB jointly apply to PSD Head for necessary rights.
taking rights from PSD.  Branch MoB /GB in-charge has responsibility to ensure
everyday EFT transactions taking a list from stelar & DigiPay
module before day-end.
Payment Service Department holds the authority of operating,  MoB must check mail before leaving office for stop payment
technical and business administration of all kind of EFT instructions, if any.
services of Bank Asia Limited.
Payment service department Payment service department
 Branch Operational Rights DigiPay Reg. Form
Maker Right: (Permanent employee only)
 Transaction origination making right
 Report right
 Immediate rectification/delete right of entry

Checker Right: (Executives, GB In-charge)

 Refusal right
 Checker limit right
 All report right of branch transaction

Administrative Right: (HoB)

 Account registration right
 Application approval right

 Receiving Bank can credit if only Account Number is valid.

 No obligation to cross-check Account Number and Account Title.

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DigiPay Reg. Form (Approval) DigiPay Excel Form

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 DigiPay Excel Upload DigiPay Single Entry Form

Payment service department Payment service department

BACH-II Developments BEFTN Laws and Regulations

EFT Transactions will be done in 5 foreign currencies in BACH-II Laws/regulations:
 USD i. EFT operation Rules and Procedures,2010.
ii. Bangladesh Payment Service Regulation,2014.
 GBP
iii. Regulation of Bangladesh Electronic Fund transfer, 2014
 Euro
 JPY
 CAD Others :
i. NI Act 1881 (Amended 2003, 2006)
ii. The Banks Companies Act, 1991
Previously, BEFTN transaction was settled on T+1 basis, that means next day. iii. Money Laundering Prevention Ordinance, 2008
After introduction of BACH-II, BEFTN is done on Multi-session basis. iv. Information and Communication Technology Act, 2006.
Now, there are 2 sessions: v. The Bankruptcy Act, 1997
vi. The Foreign Exchange Guidelines, Volume 1 & 2.
A. 00.01 hours to 14.00 hours. vii. Foreign Exchange Regulation Act, 1947.
viii. The Bangladesh Telecommunication Act, 2001.
B. 14.01 hours to 00.00 hours. ix. Bangladesh Payment and Settlement Systems Regulations, 2009
This has enabled same day BEFTN credit in beneficiary account if processed in first session. END OF BEFTN

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 RTGS - Overview Members of RTGS
RTGS is Real Time Gross Settlement Four kind of member in RTGS:

RTGS is an Inter-Bank Electronic large value Credit & Debit (Reserved  i. Direct Members : Banks, BB

for BB only) transfer system  ii. Sub Members : Small banks/Financials via
 ii. Special Members : Other DNSs (Deferred Net Settlements) – BEFTN, NPSB, BACH
 iv. Monitoring Member s : CGA & NBR (Customs, VAT, Challan)
Transfer of funds (LCY & FCY) or securities take place from one bank to
another. BB-RTGS Transaction types
Settlement in ‘Real Time’ means transaction is not subjected to any
• Interbank Transactions :
waiting period.  Money Market Transactions
‘Gross Settlement’ means the transaction is booked in central bank’s  Domestic Forex Transactions
account on one to one basis without netting with any other • Customer Transactions
transaction.  P2P, P2B, P2G, B2P, B2B, B2G, G2P, G2B
Minimum limit of transaction is 1 lac taka. • Settlement from other DNS (deferred net settlements)s :
 BACPS, BEFTN, NPSB etc.

Payment service department Payment service department

Finality & Irrevocability Important Features of RTGS

Finality and irrevocability of payments is another most prominent • Participant can only initiate Credit transfer.
feature of RTGS.
• Bangladesh Bank has sole right to issue both debit and credit transfers.
• Transaction Queuing and rights of priority selection available in
 Originator Finality: Originator has sent Payment instruction and amount RTGS system
debited from the account.

• An RTGS payment is final and irrevocable.

 Settlement Finality: Payment has been irrevocably and unconditionally
settled by RTGS.
• Multicurrency transfer facility : 6 (six) currency
 Receiver Finality: Payment is unconditionally credited to receiver’s
account. Local currency BDT is available for all.
5 Foreign currency is available for Treasury Function:
 Receiving Bank can credit if only Account Number is valid.
USD, EURO, GBP, CAD and JPY.
 No obligation to cross-check Account Number and Account Title.

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 Branch responsibility for RTGS Responsibility of Participating Member
Eligible Branch Screening required – As per BD-RTGS rule Sec 1.3
• All Branches of all banks are not RTGS enabled.
• Originating branch must confirm receiving branch is RTGS enabled before transaction.  Participants are liable for any damage resulting from non-compliance with
the procedures or from improper or fraudulent use thereof and in
particular are fully liable for every transaction performed by their user(s).
• Execution of Transaction time: Total 1 hour
• Maximum 30 minutes by originating branch to send transaction  Each participating bank shall ensure that its own system and procedures
• Maximum 30 minutes for receiving branch to honor/return. provide appropriate protection against fraudulent activity in connection
with the system.
• RTGS charge is BDT 100 (Including VAT).
• Branch should ensure charge amount is available in account.  All actual or suspected fraudulent activity in connection with RTGS must
be reported immediately to the General Manager, Payment Systems
• Charge deduction is automated by PSD for smooth operation. Department, Bangladesh Bank whether such fraud or suspected fraud is
on the part of the participant’s staff or customer or anyone else.
• Branch must send ‘Intimation Mail’ to PSD in proper manner for RTGS value above 10 lac Taka.
• Branch must obtain confirmation from Treasury Department for RTGS value above 1 crore Taka.

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Risk mitigation process - Branch Risk mitigation process - PSD

 Only Registered A/C holders will get the RTGS facility.
 Registration of A/C for RTGS needs review & clearance upon TP & KYC by the branch  PSD of Corporate Office opens and closes the RTGS business day
centrally in System
Compliance Officer.
 Initially, PSD performed all Maker and Checker functions on behalf of
 Dual authentication needs for registration & RTGS transaction. branches.

 Maker shall initiate RTGS Transaction on the basis of instruction given in RTGS request form  Now, Operation rights are given to branches having designated
by Customer manpower.
 Maker must be Senior Officer or above, or PA holder.
 Only HoB/MoB should perform as checker
 Checker must be SEO or above, and/or HoB/MoB.
 The transaction amount will not show on the checker's screen to ensure operation security.
Checker has to input the amount in checker module himself.  For amount above 1 million, 3rd authentication from PSD is required.
If amount differs, transaction will not be processed.  Other Branches communicate PSD through HoB/MoB with ‘Branch
Request’ and ‘Customer Application Form’ for central support.
 Branches shall maintain all original documents of RTGS transaction jointly signed by two
authorized officers of bank.  A Central Live Dashboard is placed at PSD for live monitoring.

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 ,

RTGS - Treasury Operation

 All Treasury deals, priority setting, inward return and responding shall be
accomplished by Treasury.
PSD
 Treasury transactions are called Pacs 008.
 Non-treasury transactions are called Pacs 009.
PROTECTED
 All return transactions are called Pacs 004.
SYSTEMATIC
 Treasury ensures sufficient fund for RTGS settlement accounts. DISCIPLINED
 Treasury monitors cash flow position in RTGS interface dashboard for
necessary fund placement.

 All kind of FC Transfers operated under dual authentication system by

Treasury without manual intervention.
END OF RTGS
Thank You…….
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