HSBC is First Bank Live on 'Game-changing' NACH System

MUMBAI, May 23, 2013 /PRNewswire/ --

HSBC is the first bank in India to complete live customer transactions on the National Automated Clearing House (NACH) debit platform. Vodafone India, one of India's leading telecommunications service providers and two asset management companies, HSBC Asset Management Company and Reliance Capital Asset Management (RCAM), are the first customers to use this new infrastructure.

India's economy has undergone rapid growth in recent years resulting in the need for a more sophisticated payments infrastructure. The creation of this new system, complemented by other innovations such as Interbank Mobile Payment Service (IMPS), means that India now has the robust platforms it needs to continue to grow. This is a prime example of the significant strides emerging economies are making in the development of their financial infrastructure.

Commenting on HSBC's early adoption of the system, Mr. Navin Gupta, Head of Payments and Cash Management, HSBC India said, "These developments enable companies in India to maximise their operating efficiency and adopt liquidity management structures that are in line with international practices - and that many global organisations expect. The system allows global banks, like HSBC, to help companies looking to do business in India to manage their cash effectively and in line with a broader global cash management strategy. This system marks a shift in India's cash management capabilities, as the country now has a payments system that makes it profoundly easier for businesses to compete."

India's NACH system, an initiative by the National Payments Corporation India (NPCI), is a new payments system which incorporates best practice functionality from existing systems around the world. With the NACH system in place, which is a significant upgrade on legacy platforms, customers can benefit from faster transaction settlement, wider coverage and superior mandate management system, resulting in greater efficiency and wider branch coverage across India - bringing a large area onto one, consistent and highly advanced system.

"NACH implementation will future proof the system in India for bulk and repetitive payments," said Shri A. P. Hota, MD & CEO, National Payments Corporation of India.

"The NACH Debit is an effective way to collect funds from our consumers spread across remote locations in India as compared to Electronic Clearing System Debits - not only are mandates registered within 3-4 days as compared to 21-25 days, it also covers all IFSC enabled branches across India. The same day transaction information also enables locking in of the funds at the current day's NAV as compared to ECS debits where we receive information only after 3-4 days," says Mr. Sundeep Sikka, CEO of Reliance Capital Asset Management.

"The NACH system is an effective platform, especially in our effort to provide "best-in-class" services to our investors. The NACH platform will help us improve upon the processes and timeliness of SIP registrations as compared to the current industry standards. The system also enables dividend payouts across our investor base in a seamless and timely manner. Finally, the platform will also provide us with a wider reach as compared to the systems prevalent today," said Puneet Chaddha, Chief Executive Officer, HSBC Global Asset Management, India.

HSBC's early adoption of this system reinforces our commitment to fulfilling our clients' need for an efficient bulk electronic payments and collections platform, and improving efficiencies to enable growth. HSBC is once again at the forefront of cash management developments in one of the world's fastest growing economies.

Notes to editors

About HSBC in India

The Hongkong and Shanghai Banking Corporation Limited in India offers a full range of banking and financial services to about 1 million customers through its 50 branches and 140 ATMs across 29 cities.

HSBC is one of India's leading financial services groups, with over 30,000 employees in its banking, investment banking and capital markets, asset management, insurance broking, insurance, software development and global resourcing operations in the country. It is a leading custodian in India. Nearly 6% of India's exports and imports pass through HSBC India's banking channels. The asset management business in India is one of the leading players in the industry. The Bank is at the forefront in arranging deals for Indian companies investing overseas and foreign investments into the country. With its extensive reach across Asia, the Americas and Europe, HSBC has the capacity to offer complete banking and financial solutions to India's burgeoning economy. In 2008, it acquired a majority stake in IL&FS Investsmart (now renamed HSBC InvestDirect) that has enabled it to offer retail brokerage services to its customer across a wider geography. It has also formed a joint venture life insurance company with Canara Bank and Oriental Bank of Commerce.

HSBC's network of branches is located at Ahmedabad, Bangalore, Chandigarh, Chennai, Coimbatore, Gurgaon, Guwahati, Hyderabad, Indore, Jaipur, Jodhpur, Kochi, Kolkata, Ludhiana, Lucknow, Mumbai, Mysore, Nagpur, Noida, New Delhi, Nasik, Patna, Pune, Raipur, Surat, Trivandrum, Thane, Vadodara and Visakhapatnam.

The Bank is the founding and a principal member of the HSBC Group which, with an international network covering 6900 offices in 80 countries and territories and assets of US$ 2,692bn at 31 December 2012, is one of the world's largest banking and financial services organisations. www.hsbc.co.in

Primary Media Contact: Neha Hora, [email protected], 91-22-22685337