Business & Economy

Bank holidays on seond, fourth Saturdays from September 1

NetIndian News Network

Mumbai, August 28, 2015

All scheduled and non-scheduled banks – public, private, foreign, cooperative, regional rural and local area banks – will observe public holiday on second and fourth Saturdays from September 1.
A press release from the Reserve Bank of India (RBI) said the banks would observe full working days on Saturdays other than second and fourth Saturdays.
Consequent to this, the RBI today announced the following changes in its functioning with effect from September 1: 
I. Financial Market Segments
a) The financial market segments which are currently open for transactions on Saturdays will continue to remain open on all working Saturdays. That is, 
i)  All money market segments, namely, call/notice/term money, market repo and Collateralised Borrowing and Lending Obligation(CBLO) will remain open on all working Saturdays as on any normal business day; and
ii)  Forex market and Government securities markets, along with all OTC derivative markets would remain closed on all Saturdays, as hitherto.
b) The Reserve Bank will continue to operate fixed rate reverse repo as well as the marginal standing facility (MSF) windows on all working Saturdays between 7:00 pm and 7.30 pm as on any normal business day.
c) The Reserve Bank will also operate a fixed rate liquidity adjustment facility (LAF) repo window on all working Saturdays between 9.30 am and 10.30 am. The LAF repo window on working Saturdays would in fact be an extension of the Friday LAF window. 
That is, banks could borrow for three days on Friday, within the prescribed limits, and any residual unused limit could be utilised for a 2-day period on working Saturdays.
II. Payment Systems
Payment systems will not be operated on second and fourth Saturdays but would operate for full day on working Saturdays. Payment systems typically includes Real Time Gross Settlement (RTGS), National Electronic Fund Transfer (NEFT), Cheque Clearing operated by various Bankers' Clearing Houses in the country including the grid based Cheque Truncation System (CTS) and ECS suite [Electronic Clearing Service (ECS), Regional Electronic Clearing Service (RECS) and National Electronic Clearing Service (NECS)].
Processing of future value dated transactions with value date falling on second and fourth Saturdays will not be undertaken under RTGS and ECS suite.
III. Banking Department
The Banking Departments in Regional Offices of the Reserve Bank will remain open for the full day on working Saturdays as required to support the functioning of the Financial Markets and the Payment Systems. Government business will be transacted at agency banks on working Saturdays.
The arrangements would be reviewed after six months, the release added.