1. CCIL
Clearing Corporation of India limited is an institution set up to clear outright and repo trades on a guaranteed basis. Negotiated Deal Settlement (NDS) is a trading platform while CCIL is a Clearing House Settling trades.
CCIL manages:
- Domestic:
- G Sec / State Government / T Bills
- Outrights
- RBI Auctions
- Repos / CBLO
- Forex
- USD / INR
- Spot
- Cash
- Tom
- Forward
CCIL has also introduced a dealing and trading platform for forex called FX Clear. FX Clear is a concept similar to operation to the NDS and enables Straight Trough Processing (STP) once a deal is concluded. FX Clear enables trading to be done through Order Matching Mode and Negotiation Mode. Order Matching Mode automatically matches the best bids and offers in the system, while the Negotiation Mode enables deals after agreement on prices, quantities, etc., between the counterparties.
2. CLS
Continuous Linked Settlement (CLS) plays a fundamental role in the foreign exchange (FX) market – it operates the largest multicurrency cash settlement system to mitigate settlement risk for the FX transactions of its Members and their customers.
CLS settles payment instructions relating to underlying FX transactions in 17 major currencies.
3. RTGS & NEFT
Payment and settlement systems in India are regulated by the Payment and Settlement Systems Act, 2007 (PSS Act), legislated in December 2007. RTGS stands for Real Time Gross Settlement. Amounts higher than 2,00,000/- (Two Lakh) can be transferred via RTGS. And as the name suggests, it happens on Real Time.
Amounts less than 2,00,000/- can be transferred via NEFT. It takes a couple of hours to reach the beneficiary account.
In India it is the BPSS (Board for Regulation of Payment and Settlement Systems) which is in charge of regulating these systems.
4. SWIFT
‘Society for Worldwide Interbank Financial Telecommunication’ is a co-operative society created under Belgian law having its Corporate Office at Brussels. The Society, which has been in operation since May 1977 and covers most of the banks in Western Europe and North America, operates a computer-guided communication system to rationalize international payment transfers. It comprises of a computer network system between participating banks with two operating centres, in Amsterdam and Brussels, where messages can be stored temporarily before being transmitted to the relevant bank’s terminal.
The SWIFT international payment network is one of the largest financial messaging systems in the world.
SWIFT assigns each financial organization a unique code.
As powerful as SWIFT is, keep in mind that it is only a messaging system – SWIFT does not hold any funds or securities, nor does it manage client accounts.
Prior to SWIFT, Telex was the only available means of message confirmation for international funds transfer. Telex was hampered by low speed, security concerns, and a free message format–in other words, Telex did not have a unified system of codes like SWIFT to name banks and describe transactions. Telex senders had to describe every transaction in sentences which were then interpreted and executed by the receiver. This led to many human errors.