eNarada, Bengaluru, October 7, 2016
It was Dasara debacle for businessmen in Bengaluru as they lost their precious money, thanks to the servers crashing at banks. As a result, most of them were unable to transfer money to companies from Friday afternoon. Now, their biggest worry is that they may not be able to remit money till next Wednesday as banks are going for a long vacation; October 8th being a second Saturday holiday followed by October 9 (Sunday), 10 (Ayudha pooja) and 11 (Vijayadashami). The industry estimate is that the money lost by individual businessmen on Friday alone was to the tune of Rs 1.25 lakh and above.
The growing incidence of real time gross settlement (RTGS) servers hanging or crashing across banks has resulted in a delay in transactions, so much so that businessmen have to wait for these transactions till Wednesday. It is said that RTGS systems have been hanging or crashing frequently, causing a delay for customers as well as bank employees but Friday was one of the worst case scenarios. The reasons behind the servers hanging are the lack of connectivity between the Reserve Bank of India (RBI) and other banks, and bad networking between the servers of banks as well as the central bank. There are also problems related with leased lines, routers and modems while transmitting messages. Since RTGS requires all the concerned parties to work simultaneously, any minute error can cause problems with the systems. However, the continuous leaves have made the matters worse this time.
“Till Friday afternoon, people were able to remit money. However, by then, the servers crashed and none of the banks were accepting money. As we could not remit the money, we have lost the precious credit money. We have been requesting the RBI officials to open the banks on Saturday at least for few hours as we will end up being big time losers,” said a businessman who did not want to be named. Sources from RBI said that servers have been crashing as the apex bank installed a new software patch in the RTGS system.
RTGS is a centralised payment system set up in 2004 by the RBI where inter-bank payment instructions are processed and settled, continuously throughout the day, as and when the instructions are received and finally accepted by the system. As a funds transfer mechanism, it is probably the fastest possible money transfer system through the banking channel. The number of bank branches offering the RTGS service has been constantly increasing over the years. The daily average volume of transactions is 90,000 for about Rs 1,200 billion, of which 82,000 transactions worth Rs980 billion pertained to customer transactions as of end-August 2009. The RTGS service window for customer’s transactions is available to banks from 9 AM to 4.30 PM on week days and from 9 AM to 2 PM on Saturdays for settlement at the RBI end. However, the timings that the banks follow may vary depending on the customer timings of the bank branches.
Piggy bank collectors also affected
Meanwhile, even the piggy bank collectors too were affected by the development as many centralised banks refused to accept cash. “We were in for a shock as we could not remit the money in banks. When we decided to return the money to our customers, we were shocked by their request when they refused to take back the money. Most of the customers; especially the women were of the view that they didn’t want the money back as their husbands would misuse the money and instead wanted us to keep the money till Wednesday next when the banks reopen after holidays,” said a piggy bank collector.
Manish, a franchisee of money transfer company ‘Smart Shop’ at Avenue Road said, he received flash message at 2pm today to disable online transactions of transferring funds to major banks.