The RBI green initiative to gradually phase out use of cheques and shift to electronic payment system will result in more cost-effective transactions and faster and accurate settlements
Mumbai: As part of its green initiative, the Reserve Bank of India (RBI) on Friday asked all non-banking financial companies (NBFCs) to gradually phase out use of cheques and shift to electronic payment system, reports PTI.
The government, in its green initiative efforts, has suggested several steps for entities in financial sector, including NBFCs, for better utilisation of resources and delivery of services.
“NBFCs are therefore, requested to take proactive steps in this regard by increasing the use of electronic payment systems, elimination of post-dated cheques and gradual phase-out of cheques in their day to day business transactions,” the RBI said.
These will result in more cost-effective transactions and faster and accurate settlements, it added.
The finance ministry has also developed an e-payment system for disbursal of subsidies to consumers of fertilisers, LPG and kerosene. This system is likely to do away with the use of cheques and bank demand drafts to make payments.
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