Nepal Clearing House Ltd. Started Running Live the Interbank Payment System from ProgressSoft
Nepal Clearing House Ltd. (NCHL) with the support of Nepal Rastra Bank started running live today ProgressSoft's Automated Clearing House solution (PS-ACH), dubbed as the Interbank Payment System (NCHL-IPS) settling 200 transactions throughout 6 clearing sessions during the first day.
NCHL-IPS is a system for clearing low-value large volume financial transactions and provides a mechanism for the participating banks and financial institutions to safely and efficiently transfer funds on behalf of their customers as well as for their own trading purposes. NCHL-IPS supports both direct debit (collections) and direct credit (transfers) transactions from any bank account to any other bank account; in addition, NCHL-IPS also supports Standing Orders or Mandate-based payments.
The adoption of ProgressSoft's Automated Clearing House solution is considered a strategic step towards the advancement of the national payments system in Nepal, where the country has adopted the Electronic Check Clearing solutions PS-ECC from ProgressSoft in 2011 granting same-day clearing and settlement of check in 120 banks and their branches within the country.
NHCL, a public company established jointly by Nepal Rastra Bank, banks and financial institutions, among others, is introducing three products to commence the operation of the payment platform. One product NHCL is launching is Customer Transfer, which enables fund transfer between bank accounts of individuals and businesses within a few hours. Another is Treasury Transfer, which enables bulk transfer of funds between financial institutions. The third product is Government Payments, which enables fund transfer between government and businesses, such as a government ministry and contractor hired to build a physical infrastructure.
"These payment services will currently be available within a network of 58 banks and financial institutions, of which 26 are commercial banks, another 26 are development banks and six are finance companies,"NCHL CEO Neelesh Man Singh Pradhan said.
Other products like salaries, pensions, social security, dividends, IPO refunds, premiums, installments, fees, etc. including both individual and repetitive volume based payments will be introduced gradually in phases
At present, customers have to rely on offline facility to transfer funds from account of one bank to that of another bank located within country. This means customers have to walk into the office of a bank or a financial institution where they have an account, fill up a form and ask the teller to transfer the amount.
Currently, for instance, private firms and government agencies ask their employees to open salary accounts in the same bank where they have an account to ease fund transfer process. "But once new system comes into operation, such procedure need not be followed, as funds can be transferred from employers' account to employees' accounts located in any bank and financial institution in a few hours,"Pradhan continued.
Mr. Michael Wakileh, CEO of ProgressSoft Corporation expressed that "The launch of ProgressSoft's ACH in Nepal is yet another milestone in the success story of ProgressSoft. We are proud of this launch and proud to be working closely with NCHL and the banking body in Nepal. We are eager to achieve a total National Payment System in the Himalayan country."
Mr. Wakileh continued, "I must thank both ProgressSoft and NCHL teams, as they are the true reason for launching this project."
The successful implementation and operation of NCHL-IPS within the 58 participating banks will not only promote non-paper based transactions, but it will be yet another milestone project to ensure efficient and effective payment and settlement mechanism in the banking and financial industry of Nepal.
The implementation of PS-ACH in Nepal is the 4th of its kind since 2010, where ProgressSoft has successfully started running it in 9 banks within Jordan, and is being implemented now in the Sultanate of Oman on a nationwide level to cover all the 26 banks within the Sultanate.
In Seychelles, ProgressSoft has implemented its Electronic Funds Transfer PS-EFT solution in 2013, which is considered a smaller scale of an ACH solution.