Outsourcing of Cash Management – Reconciliation of Transactions

May 14, 2019 | by Avantis RegTech Legal Research Team

The Reserve Bank of India (RBI) on May 14, 2019, issues guidelines on reconciliation of transactions (ATM cash replenishment) between the bank, the service provider and its sub-contractor have been examined. 

RBI has been decided that the bank shall follow the procedure as under:

1. Cash indents by the Service Provider shall be made at least a day in advance (T-1 where T is the day of cash loading), in consultation with the chest or nodal branch. Multiple points of cash withdrawal may be avoided and shall be restricted to one in each centre. However, metropolitan centres may have two points of cash withdrawal.

2. Reconciliation of transactions shall be done between the bank, the service provider and its sub-contractors at least on a T+3 basis.

3. In the event of a dispute or the reporting of alleged or attempted breach of security or laid down procedures, access to video footage of the ATM may be provided by the bank to the service provider and its sub-contractors on request.

Further, as a part of outsourcing arrangements for cash management, the bank shall encourage their service provider and its sub-contractors to:

1. put in place an efficient digital records management system for data retrieval and reconciliation.

2. create and maintain a data base of employees at industry level through any unique mode or code of identification by the Self Regulatory Organisation to ensure that they possess unblemished records.

[Notification No. DCM (Plg) No.2746/10.25.07/2018-19]

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