SFMS - Guidelines

INTRODUCTION: ................................................................ ....................................................... 3 1.

CUSTOMER CUSTOMER FUNDS TRANSFERS TRANSFERS ............ ................... ............. .............. ............... ............. ............ ............. ............... .............. ............. .......... ... 5

1.1. CUSTOMER TTS/MTS. ............................................................ ......................................................................................................... ............................................. 5 MMEDIATE APPLICATION APPLICATION OF FUNDS AND USE OF TRADITION TRADITIONAL AL MEANS OF RECONCILIAT RECONCILIATION ION . 1.1.1. IMMEDIATE (IFN 100)................................ ................................................................ ............................. 5 1.1.2. IMMEDIATE APPLICATION OF FUNDS AND USE OF IFN MESSAGES FOR RECONCILIATION . (IFN (IFN 100, 900 & 910)............. 910)................... ............. ............... .............. ............. ............. ............ ...... ERROR ! BOOKMARK NOT DEFINED . OF MESSAGES WHILE APPLYING FUNDS ................................................. 10 1.1.3. RECONCILIATION 1.1.3.1. 1.1.3.1. Direct Direct Method Method ............. .................... ............. .............. .............. ............. ............. ............. ............... .............. ............ ............. ............. .............. .............. .......... .... 10 1.1.3.1 1.1.3.1.1. .1. Reconc Reconcili iliati ation on of TT Message Message using using IFN IFN 910/900 910/900 & 195/196 195/196 messag messages es ...... ......... ...... ....... ...... 11 1.1.3.1.2. 1.1.3.1.2. Reconciliat Reconciliation ion of TT TT Message Message using IFN 910 & 195/196 messages.......... messages................. ............. ........ .. 14 1.1.3.2. 1.1.3.2. Indirect Indirect Method:....... Method:.............. ............. ............ .............. ............... ............. ............. ............. .............. .............. ............. ............. ............. .............. .............. ....... 16 1.2. MULTIPLE CUSTOMER TTS/MTS. ............................................................ ..................................................................................... ......................... 19 MMEDIATE APPLICATION APPLICATION OF FUNDS AND USE OF TRADITION TRADITIONAL AL MEANS OF RECONCILIAT RECONCILIATION ION . 1.2.1. IMMEDIATE (IFN 102)................................ ................................................................ ........................... 19 1.2.2. IMMEDIATE APPLICATION OF FUNDS AND USE OF IFN MESSAGES FOR RECONCILIATION . (IFN (IFN 102, 900 & 910)............. 910)................... ............. ............... .............. ............. ............. ............ .............. ............... ............. ............. ............. .............. .............. ............ ...... 22 OF MESSAGES WHILE APPLYING FUNDS ................................................. 25 1.2.3. RECONCILIATION 1.2.3.1. 1.2.3.1. Direct Direct Method Method ............. .................... ............. .............. .............. ............. ............. ............. ............... .............. ............ ............. ............. .............. .............. .......... .... 25 OF MESSAGES WHILE APPLYING FUNDS (IFN 1.2.3.1.1. RECONCILIATION (IFN 102, 102, 195, 195, 196, 196, 900 900 & 910) ............................................................ .................................................. ..................... 25 1.2.3.1.2. 1.2.3.1.2. Reconciliat Reconciliation ion of TT TT Message Message using IFN 910 & 195/196 messages.......... messages................. ............. ........ .. 28 1.2.3.2. 1.2.3.2. Indirect Indirect Method:....... Method:.............. ............. ............ .............. ............... ............. ............. ............. .............. .............. ............. ............. ............. .............. .............. ....... 31 EQUEST FOR TRANSFER OF FUNDS . ............. 1.3. CUSTOMER R EQUEST ................... ............ .............. ............... ............. ............. ............. ........ .. 35 ALSO BANKS WITH THE RECEIVER 1.3.1. TRANSFER IS FOR CREDIT OF A SINGLE BENEFICIARY WHO ALSO OF THE MESSAGE . (IFN 101) ............. ................... ............. ............... .............. ............. ............. ............ .............. ............... ............. ............. ............. ........ 35 1.3.2. TRANSFER IS FOR CREDIT OF MULTIPLE BENEFICIARIES WHO ALSO BANK WITH THE BRANCH TO WHICH THE IFN IFN 101 101 MESSAGE IS ADDRESSED . ............ ................... ............. .............. ............... ............. ............ ............. .......... ... 37 BRANCH 1.3.3. TRANSFER IS FOR CREDIT OF A SINGLE BENEFICIARY WHO BANKS WITH ANOTHER BRANCH OF THE SAME BANK . (IFN (IFN 101, 101, 100, 100, 900 & 910) 910) ....... .......... ...... ....... ....... ...... ...... ...... ....... ....... ...... ....... ....... ...... ...... ...... ....... ....... ..... .. 40 1.3.4. TRANSFER IS FOR CREDIT OF MULTIPLE BENEFICIARIES WHO BANK WITH OTHER BRANCHES OF THE BANK . (IFN (IFN 100, 101, 102, 900 & 910) 910) ....... .......... ...... ...... ....... ....... ...... ...... ....... ....... ...... ...... ....... ....... ...... ...... ...... ....... ........ .... 43 BANKS WITH ANOTHER BANK ’S 1.3.5. TRANSFER IS FOR CREDIT OF A SINGLE BENEFICIARY WHO BANKS BRANCH IN THE SAME ENTER AS THE BRANCH BRANCH TO WHICH THE MESSAGE IS ADDRESSED . (IFN (IFN 101) ............................................................ .................................................. ..................... 48 1.3.6. TRANSFER IS FOR CREDIT OF MULTIPLE BENEFICIARIES WHO BANK WITH OTHER BANKS ’ BRANCHES IN IN THE SAME ENTER AS THE BRANCH TO WHICH WHICH THE MESSAGE IS ADDRESSED ADDRESSED . (IFN 101)................................ ................................................................ ........................... 50 EQUEST FOR DEBIT OF CUSTOMER ’S ACCOUNT . (IFN 1.4. THIRD PARTY INSTRUCTION OR R EQUEST (IFN 104) ............................................................... ................................................................................................................. .................................................. .................... 52 1.5. DD RELATED MESSAGES. ................................................................ .................................. 53 1.5.1. DD A DVICES. (IFN 110)...... 110) ............ ............. ............. .............. ............... ............. ............ ............. ............... .............. ............. ............. ............ ............. ....... 53 EQUESTS. (IFN 111) ............. 1.5.2. DD S TOP PAYMENT R EQUESTS ................... ............ .............. ............... ............. ............ ............. ............... ............ .... 54

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1.5.3. 2.

TO DD STOP PAYMENT R EQUESTS EQUESTS. (IFN 112) ............. REPLIES ................... ............ .............. ............... ............. ............ ...... 54

INTER-BRAN INTER-BRANCH CH MESSAGES MESSAGES INVOLVING INVOLVING INTRA-BANK INTRA-BANK AND INTER-BANK INTER-BANK TRANSFER OF FUNDS:............................. FUNDS:................................................................................ ................................................... .................... 56

EQUEST FOR FOR TRANSFER OF FUNDS FROM DAD ACCOUNT OF ONE BRANCH TO ANOTHER . 2.1. .1. R EQUEST (IFN 202, 202, 210, 900 & 910)......... 910)............... ............. ............. .............. ............... ............. ............ ............. ............... .............. ............. ............. ............ ............ ...... 56 EQUEST FOR FOR TRANSFER OF FUNDS FROM DAD ACCOUNT OF ONE BRANCH TO DAD 2.2. .2. R EQUEST ACCOUNT OF TWO OR MORE BRANCHES BRANCHES . (IFN (IFN 203, 203, 210, 210, 900 900 & 910).. 910)..... ...... ...... ....... ....... ...... ...... ...... ....... ........ .... 59 EQUEST FOR TRANSFER OF FUNDS FROM FROM ONE BANK ’S BRANCH TO ANOTHER ANOTHER BANK ’S 2.3. .3. R EQUEST BRANCH . (IFN 202, 202, 201, 900 & 910) ............. ................... ............. ............... .............. ............. ............. ............ .............. ............... ............. ........... ..... 68 ECEIVED. (IFN 2.4. ADVANCE NOTICE OF FUNDS EXPECTED TO BE R ECEIVED (IFN 210)..... 210)........ ...... ...... ...... ....... ....... ...... ..... 72

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COLLECTIONS COLLECTIONS:............ :.................. ............. ............. .............. .............. ............. ............. .............. ............... ............. ............ ............. ............... .............. ............. ....... 73

3.1. 3.2. 3.3. 3.4. 3.5. 3.6. 4.

CKNOWLEDGEMENT T OF R ECEIPT ECEIPT OF COLLECTION BILLS. (IFN ACKNOWLEDGEMEN (IFN 410)..... 410)........ ...... ...... ....... ....... ...... ...... ... 73 ADVICE OF ACCEPTANCE: (IFN 412) ............. ................... ............ .............. ............... ............. ............. ............. .............. .............. ............. ....... 75 TRACER (FATE ENQUIRY): (IFN 420) 420) ............. ................... ............. .............. .............. ............. ............. ............. .............. .............. ............ ...... 76 EQUEST FOR INSTRUCTIONS: (IFN 422) ............. ADVICE OF FATE AND R EQUEST .................... ............. .............. ........... ... 77 AMENDMENT OF INSTRUCTIONS: (IFN 430)........ 430)............... ............. ............. .............. .............. ............. ............. ............. .............. .......... 79 ADVICE OF PAYMENT: (IFN 400) ............. ................... ............. ............... .............. ............ ............. ............. .............. ............... ............. ............ ...... 80

LETTERS LETTERS OF CREDIT:....... CREDIT:............. ............. ............. .............. .............. ............. ............. ............. ............... .............. ............ ............. ............. .............. ........ 83

4.1. 4.2. 4.3. 4.4. 4.5. 4.6. 4.7. 4.8. 4.9. 4.10. 4.11. 4.12.

SHORT LCS (PRE-ADVICES). (IFN 705) 705) ............. ................... ............. ............... .............. ............. ............. ............ .............. ............... ......... .. 83 LC ISSUE: (IFN 700 & 701) ............. ................... ............. ............... .............. ............. ............. ............ .............. ............... ............. ............ ............. ......... .. 85 CKNOWLEDGEMENT T OF LC MESSAGE: (IFN 730) ............. ACKNOWLEDGEMEN ................... ............. ............... .............. ............. ............. .......... .... 88 ADVICE OF ANOTHER BRANCH ’S LC: (IFN 710 & 711)............... 711)..................... ............. ............... .............. ............ ......... ... 89 TRANSFER OF LC: (IFN 720 & 721) 721) ............ ................... ............. .............. .............. ............. ............. ............. ............... .............. ............ ......... ... 92 ADVICE OF LC AMENDMENT: (IFN (IFN 707)....... 707)............. ............. ............. .............. .............. ............. ............. ............. .............. .............. ......... 96 ADVICE OF PAYMENT/ACCEPTANCE /NEGOTIATION: (IFN 754) 754) ............. .................... ............. .............. ............ .... 97 ADVICE OF PAYMENT: (IFN 756) ............. ................... ............. ............... .............. ............ ............. ............. .............. ............... ............. ............ ...... 98 ADVICE OF DISCREPANCY: (IFN 750) ............. ................... ............. .............. .............. ............. ............. ............. .............. .............. .......... .... 100 AUTHORISATION TO PAY, ACCEPT OR NEGOTIATE: (IFN (IFN 752) 752) ....... .......... ...... ...... ....... ....... ...... ...... ....... ...... .. 102 102 ADVICE OF DISCHARGE: (IFN (IFN 732) 732) ............ ................... ............. .............. ............... ............. ............ ............. ............... .............. ............ ...... 103 EFUSAL: (IFN 734)........ ADVICE OF R EFUSAL 734).............. ............ ............. ............... .............. ............. ............. ............ .............. ............... ............. ......... ... 106

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Introduction: SFMS: Message Usage Scenarios:

The following 5 SFMS Message usage scenarios can be envisaged:     

Intra Bank Messages Inter bank Messages which do not require settlement at all Inter bank Messages which do not require immediate settlement Inter Bank Messages involving bilaterally agreed methods of settlement Inter Bank Messages involving RBI for settlement

In this write up, only the first scenario has been addressed. The remaining four scenarios would be discussed discuss ed later. As such, su ch, messages that ca n be used for relaying inter bank transactions only, such as IFN 3 category messages, which deal with inter bank forex and money market trade confirmations have not been discussed here. Individual messages in other categories, which are purely inter bank in nature, for e.g., IFN 200 (Request sent to a correspondent requesting for transfer of funds between two accounts owned by the sender), IFN 950 (Account statements sent by correspondent banks to account owners) have also not been discussed.

The various business models involving traditional traditional methods of reconciliation reconciliation and innovations that can be introduced by leveraging on facilities provided by SFMS have been discussed in elaborate detail in section 1 (Customer Funds Transfers). Transfers). To avoid repetition, repetition, only a single business model has been described in the remaining chapter. Users can decide on any of the business models suggested in section 1 and apply it to the transactions described in remaining sections. Dates expressed in IFN IFN messages will have to be in the YYYYMMDD format and amounts will have to be expressed without use of comma as delimiter between hundreds, thousands, lakhs etc. However, to ensure clarity, all message formats given in examples express dates in DDMMYYYY format and comma has been used as delimiter in amount fields. Where the description of a particular field differs from the standard description given in IFN message format publications, such descriptions have been printed in capitals. E.g., Actual description description of field field 52A field in IFN 900 message is Ordering Ordering Institutio Institution, n, but it has been described here as CONTRAPARTY BRANCH. All the IFS Codes (IFSC) and many of the branches referred to in the examples are fictitious.

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The scenarios, scenarios, usages, usages, practices practices and business business models models related related in the following following pages pages are indicative and not exhaustive. Suggestions for additions, improvements, deletions and modifications to the message usage descriptions, usage scenarios, business models, examples etc., and information regarding errors if any would be g ratefully accepted and incorporated. Kindly forward your feed back to the following add ress: A.P.Raja, Project Consultant (SFMS Project), BENEFICIARIES, Masab Tank, Hyderabad 500 057. Phone : (040)3534981-4 (Extn. 2112). Fax: (040)3534981 Email: [email protected]

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1. Customer Customer Funds Transfers Transfers 1.1. Customer Customer TTs/MTs. TTs/MTs. IFN 100 messages should be used for relaying Customer TTs. The following scenarios can be envisaged: 1. Immediate Immediate applica application tion of funds funds and use use of tradition traditional al means means of reconcilia reconciliation. tion. 2. Immediate Immediate applica application tion of funds funds and use use of IFN messages messages for reconciliat reconciliation. ion. 3. Reconcilia Reconciliation tion of Messages Messages while while applying applying funds

1.1.1. Immediate application application of funds and use of traditional traditional means of reconciliation. (IFN 100) IFN 100 message is is used for relaying relaying the TT message. Reconciliation of the the TT transaction is done using the reconciliation process prevailing in the bank. Example:

On 1.09.2001, Mr. L.P.Yadav who has an account with Andhra Bank, Masab Tank, Hyderabad, requests the bank to transfer a sum of Rs 10,000/- to the account No. 123456 of Mr. N.C.Naidu with Andhra Bank, Mumbai Main Branch. The payment represents monthly rent for August 2001, on a flat leased by Mr Yadav and Charges (if any,) at the paying branch are for the beneficiary’s account. The instruction is received within the cut-off time prescribed by the Bank for same day value transfers. Andhra Bank, Masab Tank TT Reference No. is TT/567/2001. The information to be provided by Andhra Bank, Masab Tank to Andhra Bank, Mumbai in the TT message would be as follows: Sending Branch

: Andhra Bank, Masab Tank, Hyderabad (IFSC say ANDB0000456) Receiving Branch : Andhra Bank, Main Branch, Mumbai (IFSC say ANDB0000123) TT Reference No. : TT/567/2001 TT Ordered By : L.P.Yadav Amount : Rs 10,000.00 Value Date : 17.10.2001 Favouring : N.C.Naidu Beneficiary’s Account No. : 123456 Account maintained with : Andhra Bank, Mumbai Main Branch Detail Detailss of Payment Payment for for Benefi Beneficia ciary ry : Monthl Monthly y rent rent for August August 2001 2001 Paying Paying Bank Bank charg charges es to be borne borne by : Benef Benefici iciary ary

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Andhra Bank, Masab Tank sends an IFN 100 message to Andhra Bank, Mumbai Main Branch and reports the transaction by sending a credit Report to the Bank’s Reconciliation System On receipt of a valid and authenticated IFN 100 message, Andhra Bank, Mumbai Main Branch applies funds to Mr. Naidu’s account and reports the transaction by sending a debit report to the Bank’s Reconciliation System.

Message Flow:

L.P.YADAV FUNDS

ANDHRA BANK MASAB TANK

IFN 100

N.C.NAIDU

FUNDS

CREDIT REPORT

ANDHRA BANK RECONCILIATION SYSTEM

ANDHRA BANK MUMBAI

DEBIT REPORT

The extract of header and text block of the IFN 100 Message sent by Andhra Bank, Masab Tank to Andhra Bank, Mumbai Main Branch would be as follows: Header Block: Sender Receiver Message Type

ANDB0000456 ANDB0000123 IFN 100

Andhra Bank, Masab Tank, Hyderabad Andhra Bank, Mumbai Customer Transfer

Text Block: Field Description 20 Transaction Reference No. 32A 32A Value Da Date Currency ncy & Amount 50 Ordering Customer 59 Beneficiary

70 7 1A

Details of Payment Details of Charges

Information TT/567/2001 17092001I 01INR10,000.00 .00 L.P.YADAV /123456 N.C.NAIDU RENT FOR AUGUST 2001 BEN

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1.2. IFN 100 message is used for relaying the TT message. SFMS branches use IFN 900 (advice of Debit) and IFN 910 (advice of Credit) for relaying the Debit and credit reports to the Reconciliation System. This would necessitate changes at system and policy level in the Reconciliation mechanism of the Bank. The benefits accruing to the Bank by adopting this method are:  

Debit entries relating to Paid TTs would normally be outstanding for a few minutes only. Outstanding Credit entries relating to TT transactions would normally represent TTs issued but not paid. As disposal of such entries are critical from a customer service stand point, it will now be possible to view and monitor su ch entries from a central location.

Example:

In the example quoted in section 1.1.1 above, Andhra Bank, Masab Tank sends an IFN 100 message to Andhra Bank, Mumbai Main Branch and reports the transaction by sending an IFN 910 message to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 100 message, Andhra Bank, Mumbai Main Branch applies funds to Mr. Naidu’s account and reports the transaction by sending an IFN 900 message to the Bank’s Reconciliation System (IFSC say ANDB0000999). Message Flow:

L.P.YADAV FUNDS


IFN 100

N.C.NAIDU

FUNDS

ANDHRA BANK MUMBAI

IFN 910


IFN 900

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The extract of header and text block of the IFN 100 Message sent by Andhra Bank, Masab Tank to Andhra Bank, Mumbai Main Branch would be as follows:

Header Block: Sender Receiver Message Type

ANDB0000456 ANDB0000123 IFN 100



70 7 1A



The extract of header and text block of the IFN 910 Message sent by Andhra Bank, Masab Tank to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ANDB0000456 ANDB0000999 IFN 910

Andhra Bank, Masab Tank, Hyderabad Andhra Bank Reconciliation System Credit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Value Da Date Currency ncy & Amount 5 2A CONTRA PA PARTY BR BRANCH

Information TT/567/2001 NONREF INTER BRANCH ACCOUNT 17092001I 01INR10,000.00 .00 ANDB0000123

The extract of header and text block of the IFN 900 Message sent by Andhra Bank, Mumbai Main Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ANDB0000123 ANDB0000999 IFN 900

Andhra Bank, Mumbai Andhra Bank Reconciliation System Debit Advice

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Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Valu Va luee Date ate Cur Currency ency & Amou Amount nt 5 2A CONTRA PA PARTY BR BRANCH

Information TTP/987/2001 (1) TT/567/2001 INTER BRANCH ACCOUNT 1709 170920 2001 01IINR10 NR10,0 ,000 00.0 .00 0 (2) ANDB0000456

(1) (1)

This This is is the the paying paying bran branch ch TT Ref Refer eren ence ce No. No.

(2)

The date date to be furnished furnished in Field Field 32A is the value date date indicat indicated ed in the the original original TT TT message. Even if Andhra Bank, Mumbai Main Branch were to apply funds on the next or any subsequent day, the date in field 32A should be the one mentioned in the IFN 100 to facilitate reconciliation.

1.2.1. Reconciliation of Messages while applying applying funds funds Reconciliation of customer payment transactions before applying funds requires changes at system and policy level in the Reconciliation Reconciliation mechanism of the Bank. The benefits accruing to the Bank by adopting this method are:  

Debit entries relating to Paid TTs would not be outstanding at all. all. Outstanding Credit entries relating to TT transactions would normally represent TTs issued but not paid. As disposal of such entries are critical from a customer service stand point, it will now be possible to view and monitor su ch entries from a central location.

This can be done in two ways namely the direct method and the indirect method.

1.2. 1.2.1. 1.1. 1. Dire Direct ct Meth Method od

IFN 100 messages are sent directly to the paying branch and IFN 910 message is sent to the Reconciliation System. The paying branch queries the Reconciliation System before applying funds. The various possible scenarios under this method have been discussed below:

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1.2.1.1.1. Reconciliation Reconciliation of TT Message Message using IFN IFN 910/900 910/900 & 195/196 messages messages

The Ordering Branch uses IFN 100 message to relay the Payment Order to the Paying branch and uses an IFN 910 message to relay the credit advice to the Reconciliation System. The Paying Branch sends an IFN 195 message to the Reconciliation System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit. The Paying branch applies funds and uses an IFN 900 message to relay the debit advice to the Reconciliation System. Example:

In the example quoted in section 1.1.1 above, Andhra Bank, Masab Tank sends an IFN 100 message to Andhra Bank, Mumbai Main Branch and reports the transaction by sending an IFN 910 message to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 100 message, Andhra Bank, Mumbai Main Branch sends an IFN 195 message to the Reconciliation System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit. Andhra Bank, Mumbai Main Branch applies funds to Mr. Naidu’s account and reports the transaction by sending an IFN 900 message to the Bank’s Reconciliation System. Message Flow: L.P.YADAV FUNDS


IFN 910


IFN 100 IFN 195

N.C.NAIDU

FUNDS

ANDHRA BANK MUMBAI

IFN 196

IFN 900

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ANDB0000456 ANDB0000123 IFN 100



70 7 1A




ANDB0000456 ANDB0000999 IFN 910




The extract of header and text block of the IFN 195 Query Message sent by Andhra Bank, Mumbai Main Branch to the Reconciliation Reco nciliation System would be as follows: Header Block: Sender Receiver Message Type

ANDB0000123 ANDB0000999 IFN 195

Andhra Bank, Mumbai Andhra Bank Reconciliation System Query

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Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 75 Queries

Information TTP/987/2001 TT/567/2001 /18/ (Please authorize us to debit) ANDB0000456 17092001INR10,000.00

The extract of header and text block of the IFN 196 Answer Message sent by the Reconciliation System to Andhra Bank, Mumbai Main Branch w ould be as follows: Header Block: Sender Receiver Message Type

ANDB0000999 ANDB0000123 IFN 196

Andhra Bank Reconciliation System Andhra Bank, Mumbai Reply

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 76 Answer

Information TT/567/2001 TTP/987/2001 /10/ (We authorize you to debit)

The extract of header and text block of the IFN 900 Message sent by Andhra Bank, Mumbai Main Branch to the Reconciliation System to would be as follows: Header Block: Sender Receiver Message Type

ANDB0000123 ANDB0000999 IFN 900



Information TTP/987/2001 TT/567/2001 INTER BRANCH ACCOUNT 17092001I 01INR10,000.00 .00 ANDB0000456

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1.2.1. 1.2.1.1.2 1.2..

Recon Reconcil ciliat iation ion of of TT Messa Message ge using using IFN IFN 910 910 & 195/196 195/196 mes messag sages es

The Ordering Branch uses IFN 100 message to relay the Payment Order to the Paying branch and uses an IFN 910 message to relay the credit advice to the Reconciliation System. The Paying Branch sends an IFN 195 message to the Reconciliation System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit and treats the transaction as reconciled without waiting for an IFN 900 from the Paying Branch. The Paying branch applies funds. In other words, the IFN 195 message requesting authorization to debit also acts as an IFN 900 (Debit Advice) Message. Example:

In the example quoted in section 1.1.1 above, Andhra Bank, Masab Tank sends an IFN 100 message to Andhra Bank, Mumbai Main Branch and reports the transaction by sending an IFN 910 message to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 100 message, Andhra Bank, Mumbai Main Branch sends an IFN 195 message to the Reconciliation System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit and treats the message as reconciled. Andhra Bank, Mumbai Main Branch applies funds to Mr. Naidu’s account. Message Flow:

L.P.YADAV

FUNDS


IFN 910


IFN 100

IFN 195 IFN 196

N.C.NAIDU

FUNDS

ANDHRA BANK MUMBAI

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ANDB0000456 ANDB0000123 IFN 100



70 7 1A




ANDB0000456 ANDB0000999 IFN 910




The extract of header and text block of the IFN 195 Query Message sent by Andhra Bank, Mumbai Main Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ANDB0000123 ANDB0000999 IFN 195

Andhra Bank, Mumbai Andhra Bank Reconciliation System Query

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Information TTP/987/2001 TT/567/2001 /18/ (Please authorize us to debit) ANDB0000456 17092001INR10,000.00

The extract of header and text block of the IFN 196 Answer Message sent by the Reconciliation System to Andhra Bank, Mumbai Main Main Branch would be as follows: Header Block: Sender Receiver Message Type

ANDB0000999 ANDB0000123 IFN 196

Andhra Bank Reconciliation System Andhra Bank, Mumbai Reply

Text Block: Field 20 21 75

1.2. 1.2.1. 1.2. 2.

Description Transaction Reference No. Related Reference Queries


Indi Indire rect ct Meth Method od::

Instead of sending the Payment Order to the Paying Branch, The Ordering Branch sends the IFN 100 message to the Reconciliation System. The Reconciliation System in turn, relays the IFN 100 message to the Paying Branch. The Paying branch applies funds and sends an IFN 900 to the Reconciliation System. It is to be noted that the IFN 100 message from the Ordering Branch to the Reconciliation System also acts as an Advice of Credit. Example:

In the example quoted in section 1.1.1 above, Andhra Bank, Masab Tank sends an IFN 100 message to the Bank’s Reconciliation System. The Bank’s Reconciliation System in turn sends an IFN 100 message to Andhra Bank, Mumbai Main Branch. On receipt of a valid and authenticated IFN 100 message, Andhra Bank, Mumbai Main Branch applies funds to Mr. Naidu’s account and reports the transaction by sending an IFN 900 message

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Message Flow: ANDHRA BANK MASAB TANK

L.P.YADAV FUNDS

IFN 100


IFN 100

N.C.NAIDU

IFN 900

ANDHRA BANK MUMBAI

FUNDS

The extract of header and text block of the IFN 100 Message sent by Andhra Bank, Masab Tank to the Bank’s Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ANDB0000456 ANDB0000999 IFN 100

Andhra Bank, Masab Tank, Hyderabad Andhra Ba Bank, Re Reconciliation Sy System Customer Transfer

Text Block: Field Description 20 Transaction Reference No. 32A 32A Value Da Date Currency ncy & Amount 50 Ordering Customer 5 7A Account wi with Ba Bank (B (BRANCH) 59 Beneficiary

70 7 1A


Information TT/567/2001 17092001I 01INR10,000.00 .00 L.P.YADAV ANDB0000123 /123456 N.C.NAIDU RENT FOR AUGUST 2001 BEN

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The extract of header and text block of the IFN 100 Message sent by the Bank’s Reconciliation System to Andhra Bank, Mumbai Main Branch would be as follows: Header Block: Sender Receiver Message Type

ANDB0000999 ANDB0000123 IFN 100

Andhra Bank Reconciliation System Andhra Bank, Mumbai Customer Transfer

Text Block: Field Description 20 Transaction Reference No. 32A 32A Value Da Date Currency ncy & Amount 50 Ordering Customer 5 2A Ordering Bank (BRANCH) 59 Beneficiary

70 7 1A


Information TT/567/2001 17092001I 01INR10,000.00 .00 L.P.YADAV ANDB0000456 /123456 N.C.NAIDU RENT FOR AUGUST 2001 BEN

The extract of header and text block of the IFN 900 Message sent by Andhra Bank, Mumbai Main Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ANDB0000123 ANDB0000999 IFN 900



Information TTP/987/2001 TT/567/2001 INTER BRANCH ACCOUNT 17092001I 01INR10,000.00 .00 ANDB0000456

18

1.3. 1.3. Mult Multip iple le Cust Custome omerr TTs TTs/M /MTs Ts.. IFN 102 messages should be used for relaying Multiple Customer TTs. The following scenarios can be envisaged:   

Immediate application of funds and use of traditional means of reconciliation. Immediate application of funds and use of IFN messages for reconciliation. Reconciliation of Messages while applying funds

1.3.1. Immediate application application of funds and use of traditional traditional means of reconcili reconciliatio ation. n. (IFN 102) 102) IFN 102 message is used for relaying multiple TTs in a single message. Reconciliation of the TT transactions is done using the reconciliation process prevailing in the bank. The Ordering Customer’s branch (Ordering Branch) sends an IFN 102 Message to the Paying Branch and sends a Credit Report to the Bank’s Reconciliation System by traditional means. The Paying Branch applies funds to the Beneficiaries’ accounts and sends a Debit Report to the Bank’s Reconciliation System by traditional means. Example:

On 1.09.2001, M/s. XYZ Ltd request Allahabad Bank, Kolkata to transfer funds for credit of their employees’ accounts with Allahabad Bank, Bangalore as detailed below. The payments represent salary for the month of August 2001 Sl. No. 1 2 3

Employee’s Na Name K.L.Ram M.N.Rahim O.P.Roberts

Account No. 4567890 5678901 6789012

Amount (Rs) 12,000.00 12,500.00 13,000.00

Charges (if any,) at the paying branch are for the remitter’s account. The instruction is received after the cut-off time prescribed by the Bank for same day value transfers. Allahabad Bank, Kolkata Reference Nos. are TT/345/2001, TT/346/2001 and TT/347/2001 respectively. While reporting multiple TTs to Reconciliation System, the practice in Allahabad Bank is that both the issuing branch and paying branch quote the Reference No. of the first TT. viz., TT/345/2001 in this case. The information to be provided by Allahabad Bank, Kolkata to Allahabad Bank, Bangalore in the TT message would be as follows:

19

Information Information Common to all TTs: TTs :

Sending Branch

: Allahabad Bank, Kolkata (IFSC say ALLA0000123) Receiving Branch : Allahabad Bank, Bangalore (IFSC say ALLA0000234) TTs Ordered By : XYZ Ltd Sum Total of all TTs : Rs 37,500.00 Value Date : 2.9.2001 * Beneficiaries bank with : Allahabad Bank, Bangalore Details Details of Payment for Benefic Beneficiarie iariess : Salary for August August 2001 Paying Bank charges charges to be borne by : Ordering Ordering Customer Customer * Funds cannot be applied same day value viz., 1.9.2001, because the payment instruction was received after the cutoff time for same da y value TTs) Information relevant to individual TTs: TT Reference No. TT/345/2001 TT/346/2001 TT/347/2001

Beneficiary K.L.Ram M.N.Rahim O.P.Roberts

Beneficiary’s Account No. 4567890 5678901 6789012

Allahabad Bank, Kolkata sends an IFN 102 message to Allahabad Bank, Bangalore Branch and reports the transaction by sending a credit Report to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 102 message, Allahabad Bank, Bangalore applies funds to the beneficiaries’ accounts and reports the transaction by sending a debit report to the Bank’s Reconciliation System. Message Flow:

XYZ LTD

FUNDS

ALLAHABAD BANK KOLKATA

IFN 102

K.L.RAM

FUNDS

M.N.RAHIM

FUNDS

O.P.ROBERTS

ALLAHABAD BANK BANGALORE

CREDIT REPORT

ALLAHABAD BANK RECONCILIATION SYSTEM

DEBIT REPORT

FUNDS

20

The extract of header and text block of the IFN 102 Message sent by Allahabad Bank, Kolkata to Allahabad Bank, Bangalore Branch would be as follows: Header Block: Sender Receiver Message Type

ALLA0000123 ALLA0000234 IFN 102

Allahabad Bank, Kolkata Allahabad Ba Bank, Ba Bangalore Multiple Customer Transfers

Text Block: Field Description 20 File Reference 23 Bank Operation Code 5 1A Sending Institution IFSC Code 50 Ordering Customer

7 1A Details of Charges Transaction details: 1 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary Transaction details: 2 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary Transaction details: 3 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary

Information TT/345/2001 (1) CREDIT ALLA0000123 M/S XYZ LTD., KOLKATA OUR

TT/345/2001 INR12,000.00 /4567890 K.L.RAM TT/346/2001 INR12,500.00 /5678901 M.N.RAHIM TT/347/2001 INR13,000.00 /6789012 O.P.ROBERTS

Settlement details 32A 32A Valu Va luee Date, ate, Cur Currency ency & Amou Amount nt 0209 020920 2001 01IINR37 NR37,5 ,500 00.0 .00 0 (1) This is the reference reference to be quoted while reporting to the Reconciliation System.

21

1.3.2. 1.3.2.

Immedi Immediate ate appli applica catio tion n of funds funds and and use of IFN IFN message messagess for reconciliation. reconciliation. (IFN 102, 900 & 910)

IFN 102 message is used for relaying Multiple TTs in a single message. SFMS branches use IFN 900 (advice of Debit) and IFN 910 (advice of Credit) for for relaying the Debit and Credit reports to the Reconciliation System. The Ordering Customer’s branch (Ordering Branch) sends an IFN 102 Message to the Paying Branch and reports to the Bank’s Reconciliation System by sending an IFN 910 Message. The Paying Branch applies funds to the Beneficiary’s account and reports to the Bank’s Reconciliation System by sending an IFN 900 Message. Example:

In the example quoted in section 1.2.1 above, Allahabad Bank, Kolkata sends an IFN 102 message to Allahabad Bank, Bangalore Bangalore Branch and reports reports the transaction by sending an IFN 910 Message to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 102 message, Allahabad Bank, Bangalore applies funds to the beneficiaries’ accounts and reports the transaction by sending an IFN 900 Message to the Bank’s Reconciliation System (IFSC say ALLA0000999).

Message Flow:

XYZ LTD FUNDS


IFN 910

ALLAHABAD BANK RECONCILIATION SYSTEM IFN 102

K.L.RAM FUNDS M.N.RAHIM FUNDS


IFN 900

O.P.ROBERTS FUNDS

22


ALLA0000123 ALLA0000234 IFN 102



7 1A Details of Charges Transaction details: 1 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary Transaction details: 2 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary Transaction details: 3 21 Transaction Re Reference 3 2B Currency & Amount 59 Beneficiary

Information TT/345/2001 CREDIT ALLA0000123 M/S XYZ LTD., KOLKATA OUR

TT/345/2001 INR12,000.00 /4567890 K.L.RAM TT/346/2001 INR12,500.00 /5678901 M.N.RAHIM TT/347/2001 INR13,000.00 /6789012 O.P.ROBERTS

Settlement details 32A 32A Valu Va luee Date, ate, Cur Currency ency & Amou Amount nt 0209 020920 2001 01IINR37 NR37,5 ,500 00.0 .00 0 The extract of header and text block of the IFN 910 Message sent by Allahabad Bank, Kolkata to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ALLA0000123 ALLA0000999 IFN 910

Allahabad Bank, Kolkata Allahabad Ba Bank Re Reconciliation Sy System Credit Advice

23


Information TT/345/2001 NONREF INTER BRANCH ACCOUNT 02092001I 01INR37,500.00 .00 ALLA0000234

The extract of header and text block of the IFN 900 Message sent by Allahabad Bank, Bangalore Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ALLA0000234 ANDB0000999 IFN 900

Allahabad Bank, Bangalore Andhra Bank Reconciliation System Debit Advice


Information TTP/579/2001 (1) TT/345/2001 INTER BRANCH ACCOUNT 0209 020920 2001 01IINR37 NR37,5 ,500 00.0 .00 0 (2) ALLA0000123

(1) (1)

This This is the the pay paying ing bran branch ch TT TT Ref Refer eren ence ce No. No.

(2)

The date date to be furnished furnished in Field Field 32A is the value date date indicat indicated ed in the the original original TT TT message. Even if Allahabad Bank, Bangalore Branch were to to apply funds funds on the next or any subsequent day, the date in field 32A should be the one mentioned in the IFN 100 to facilitate reconciliation.

In case, Allahabad Bank, Bangalore is unable to apply one or more TTs conveyed in the above message, it should still send the IFN 900 Message for the full amount and vouch reversal credits to Allahabad Bank, Kolkata separately to avoid reconciliation errors.

24

1.3.3. 1.3.3.

Reconc Reconcili iliati ation on of Mess Message agess while while appl applyin ying g funds funds

Reconciliation of multiple customer payment transactions before applying can be achieved in two ways namely the direct method and the indirect method. 1.3.3.1.

Direct Method

IFN 102 messages are sent directly to the paying branch and IFN 910 message is sent to the Reconciliation System. The paying branch queries queries the Reconciliation System before applying applying funds. The various possible scenarios under this method have been discussed below:

1.3.3. 1.3.3.1.1 1.1..

Reconc Reconcili iliati ation on of of Messa Messages ges while while app applyi lying ng fund fundss (IFN (IFN 102, 102, 195, 195, 196, 900 & 910)

IFN 102 message is used for relaying the TT message. SFMS branches use IFN 910 (advice of Credit) for relaying the credit reports to the Reconciliation System. The Paying Branch queries the Reconciliation System before applying funds. The Ordering Branch uses IFN 102 message to relay the Payment Order to the Paying branch and uses an IFN 910 message to relay the credit advice to the Reconciliation System. The Paying Branch sends an IFN 195 message to the Reconciliation System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit. The Paying branch applies funds and uses an IFN 900 message to relay the debit advice to the Reconciliation System. Example:

In the example quoted in section 1.2.1 above, Allahabad Bank, Kolkata sends an IFN 102 message to Allahabad Bank, Bangalore Branch and reports the transaction by sending an IFN 910 Message to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 102 message, Allahabad Bank, Bangalore Branch sends an IFN 195 message to the Reconciliation System System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit. Allahabad Bank, Bangalore Branch applies funds to beneficiaries’ accounts and reports the transaction by sending an IFN 900 message to the Bank’s Reconciliation System.

25

Message Flow:


XYZ LTD FUNDS

IFN 910


IFN 102 IFN 195

IFN 196

K.L.RAM

M.N.RAHIM


FUNDS

IFN 900

O.P.ROBERTS


ALLA0000123 ALLA0000234 IFN 102



7 1A Details of Charges Transaction details: 1 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary


TT/345/2001 INR12,000.00 /4567890 K.L.RAM

26

Transaction details: 2 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary

TT/346/2001 INR12,500.00 /5678901 M.N.RAHIM


TT/347/2001 INR13,000.00 /6789012 O.P.ROBERTS

Settlement details 32A 32A Valu Va luee Date, ate, Cur Currency ency & Amou Amount nt 0209 020920 2001 01IINR37 NR37,5 ,500 00.0 .00 0 The extract of header and text block of the IFN 910 Message sent by Allahabad Bank, Kolkata to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ALLA0000123 ALLA0000999 IFN 910




The extract of header and text block of the IFN 195 Query Message sent by Allahabad Bank, Bangalore Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ALLA0000234 ALLA0000999 IFN 195


Allahabad Bank, Bangalore Allahabad Ba Bank Re Reconciliation Sy System Query

Information TTP/579/2001 TT/345/2001 /18/ (Please authorize us to debit) ALLA0000123 02092001INR37,500.00

27

The extract of header and text block of the IFN 196 Answer Message sent by the Reconciliation System to Allahabad Bank, Bangalore Branch would be as follows: Header Block: Sender Receiver Message Type

ALLA0000999 ALLA0000234 IFN 196

Allahabad Bank Reconciliation System Allahabad Ba Bank, Ba Bangalore Reply




ANDB0000234 ANDB0000999 IFN 900



Information TTP/579/2001 TT/345/2001 INTER BRANCH ACCOUNT 02092001I 01INR37,500.00 .00 ALLA0000123

In case, Allahabad Bank, Bangalore is unable to apply one or more TTs conveyed in the above message, it should still send the IFN 900 Message for the full amount and vouch reversal credits to Allahabad Bank, Kolkata separately to avoid reconciliation errors.

1.3.3. 1.3.3.1.2 1.2..

Recon Reconcil ciliat iation ion of of TT Messa Message ge using using IFN IFN 910 910 & 195/1 195/196 96 messa messages ges

The Ordering Branch uses IFN 102 message to relay the Payment Order to the Paying branch and uses an IFN 910 message to relay the credit advice to the Reconciliation System. The Paying Branch sends an IFN 195 message to the Reconciliation System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit and treats the transaction as reconciled without waiting for an IFN 900 from the Paying Branch. The Paying branch applies funds. 28

Example:

In the example example quoted quoted in section section 1.2.1 above, above, Allahabad Allahabad Bank, Kolkata Kolkata sends an IFN 102 102 message to Allahabad Bank, Bangalore Branch and reports the transaction by sending an IFN 910 Message to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 102 message, Allahabad Bank, Bangalore Branch sends an IFN 195 message to the Reconciliation System requesting authorization to debit. The Reconciliation System sends an IFN 196 authorizing the debit and treats the transaction as reconciled. Allahabad Bank, Bangalore Branch applies funds to beneficiaries’ accounts. Message Flow:

XYZ LTD FUNDS


IFN 910


IFN 102 IFN 195

IFN 196

K.L.RAM FUNDS M.N.RAHIM

O.P.ROBERTS

FUNDS


FUNDS


ALLA0000123 ALLA0000234 IFN 102


29


7 1A Details of Charges Transaction details: 1 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary


TT/345/2001 INR12,000.00 /4567890 K.L.RAM


TT/346/2001 INR12,500.00 /5678901 M.N.RAHIM


TT/347/2001 INR13,000.00 /6789012 O.P.ROBERTS

Settlement details 32A 32A Value Da Date, te,Currency ncy & Am Amount

02092001I 01INR37,500.00 .00

The extract of header and text block of the IFN 910 Message sent by Allahabad Bank, Kolkata to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ALLA0000123 ALLA0000999 IFN 910




30

The extract of header and text block of the IFN 195 Query Message sent by Allahabad Bank, Bangalore Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

ALLA0000234 ALLA0000999 IFN 195


Allahabad Bank, Bangalore Allahabad Ba Bank Re Reconciliation Sy System Query

Information TTP/579/2001 TT/345/2001 /18/ (Please authorize us to debit) ALLA0000123 02092001INR37,500.00

The extract of header and text block of the IFN 196 Answer Answer Message sent by the Reconciliation System to Allahabad Bank, Bangalore Branch wou ld be as follows: Header Block: Sender Receiver Message Type

ALLA0000999 ALLA0000234 IFN 196


Allahabad Bank Reconciliation System Allahabad Ba Bank, Ba Bangalore Reply


1.3.3. 1.3.3.2. 2. Indir Indirec ectt Metho Method: d:

Instead of sending the Payment Order to the Paying Branch, The Ordering Branch sends the IFN 102 message to the Reconciliation System. The Reconciliation System in turn, relays the IFN 102 message to the Paying Branch. The Paying branch applies funds and sends an IFN 900 to the Reconciliation System. It is to to be noted that the IFN IFN 102 message from the Ordering Branch Branch to the Reconciliation System also acts as an Advice of Credit Example:

In the example quoted in section 1.1.1 above, Allahabad Bank, Kolkata sends an IFN 102 message to the Bank’s Reconciliation System. The Bank’s Reconciliation System in turn sends an IFN 102 message to Allahabad Bank, Bangalore.

31

On receipt of a valid and authenticated IFN 102 message, Allahabad Bank, Bangalore applies funds to the beneficiaries’ beneficiaries’ accounts and reports reports the transaction by sending an IFN 900 Message to the Bank’s Reconciliation System. Message Flow: ALLAHABAD BANK KOLKATA

XYZ LTD FUNDS

IFN 102


IFN 102

K.L.RAM

M.N.RAHIM

O.P.ROBERTS

IFN 900

FUNDS

FUNDS

FUNDS


The extract of header and text block of the IFN 102 Message sent by Allahabad Bank, Kolkata to the Bank’s Reconcilia Reconciliation tion System, System, would be as follows: follows: Header Block: Sender Receiver Message Type

ALLA0000123 ALLA0000999 IFN 102

Allahabad Bank, Kolkata Allahabad Ba Bank Re Reconciliation Sy System Multiple Customer Transfers

32


7 1A Details of Charges Transaction details: 1 21 Transaction Reference 3 2B Currency & Amount 5 7A Account With Institution 59 Beneficiary


TT/345/2001 INR12,000.00 ALLA0000234 /4567890 K.L.RAM

Transaction details: 2 21 Transaction Reference 3 2B Currency & Amount 5 7A Account With Institution 59 Beneficiary

TT/346/2001 INR12,500.00 ALLA0000234 /5678901 M.N.RAHIM

Transaction details: 3 21 Transaction Reference 3 2B Currency & Amount 5 7A Account With Institution 59 Beneficiary

TT/347/2001 INR13,000.00 ALLA0000234 /6789012 O.P.ROBERTS

Settlement details 32A 32A Valu Va luee Date, ate, Cur Currency ency & Amou Amount nt 0209 020920 2001 01IINR37 NR37,5 ,500 00.0 .00 0 The extract of header and text block of the IFN 102 Message sent by the Bank’s Reconciliation System to Allahabad Bank, Bangalore would be as follows: Header Block: Sender Receiver Message Type

ALLA0000999 ALLA0000234 IFN 102

Allahabad Bank Reconciliation System Allahabad Bank, Bangalore Multiple Customer Transfers


7 1A

Details of Charges


33


TT/345/2001 INR12,000.00 /4567890 K.L.RAM


TT/346/2001 INR12,500.00 /5678901 M.N.RAHIM


TT/347/2001 INR13,000.00 /6789012 O.P.ROBERTS

Settlement details 32A 32A Value Da Date, te,Currency ncy & Am Amount

02092001I 01INR37,500.0 0.00


ANDB0000234 ANDB0000999 IFN 900




34

1.4. Customer Customer Request for Transfer Transfer of Funds. Funds. SFMS also supports messages, which enable the customer of a particular branch of a bank to issue instructions through another branch of the bank to transfer funds from his account maintained at the first branch to his own account or a third party’s account maintained at one of the branches of the bank or branches of another bank in the same center as the branch to which the message is addressed. The customer will have to execute a special agreement with the Account Servicing Branch authorizing them to execute such instructions if they are guaranteed by another branch. IFN 101 Messages are used for relaying such suc h requests for transfer of funds. IFN 101 is a very useful message message which, if properly properly implemented, implemented, enables customers customers to move funds to their own accounts or to third party accounts from remote centres. Such requests, requests, if promptly executed, executed, virtually realise realise Any Branch Banking. Banking.

IFN 101 (Single Customer TT) messages should be used for relaying Customer TTs. The following scenarios can be envisaged:

1.4.1. 1.4.1.

Transfer Transfer is is for credit credit of a single single benef beneficiar iciary y who also bank bankss with the receiver of the message. (IFN 101)

As the beneficiary banks with the branch to which the IFN 101 message is addressed, the funds are applied to the debit debit of the ordering customer. No reporting to the Bank’s Bank’s Reconciliation System is involved since the movement of funds is from one account of the branch to another. Example:

On 10.09.2001, M/s. ABC Ltd request Bank of Maharastra, Pune to instruct their Karad branch to debit M/s. ABC Ltd’s account with Bank of Maharastra, Karad and transfer Rs 10,000.00 same day value for credit of Account No. 76543 of JK&Co with Bank of Maharastra, Karad in full settlement of Inv. 74747. ABC Ltd’s reference is PYT173314. All charges are for beneficiary’s account. The information to be provided by Bank of Maharastra, Pune to Bank of Maharastra, Karad in the IFN 101 message would be as follows: Sending Branch Receiving Branch Tran Transf sfer er Requ Reques estt Ref Refer eren ence ce No. Ordering Party Their Reference

: Bank of Maharastra, Pune (IFSC say BOMA0000001) : Bank of Maharastra, Karad (IFSC say BOMA 0000456) : DR5 DR567 678/ 8/20 2001 01 : ABC Ltd : PYT173314 35

Amount Value Date Account to be debited Account maintained with Beneficiary Beneficiary’s Account No. Account maintained with Detail Detailss of Payme Payment nt for Benefi Beneficia ciary ry Paying Bank charges charges to be borne by

: Rs 10,000.00 : 10.09.2001 : 3534981 : Bank of Maharastra, Karad : JK&Co : 76543 : Bank of Maharastra, Karad : Full Full settl settleme ement nt of Inv. Inv. 74747 74747 : Benefici Beneficiary ary

Bank of Maharastra, Pune sends an IFN 101 message to its Karad branch. On receipt of a valid IFN 101 message, Bank of Maharastra, Karad debits ABC Ltd’s account and credits JK&Co’s account and sends a debit advice to the former and a credit advice to the latter. Message Flow: ABC LTD INSTRUCTION

DEBIT ADVICE

IFN 101

CREDIT ADVICE

JK&CO

JK&CO’S ACCOUNT WITH BOM, KARAD

BANK OF MAHARASTRA PUNE

FUNDS

BANK OF MAHARASTRA KARAD

ABC LTD’S ACCOUNT WITH BOM, KARAD

The extract of header and text block of the IFN 101 Message sent by Bank of Maharastra, Pune to their Karad Karad branch would would be as follows: Header Block: Sender Receiver Message Type

BOMA0000001 BOMA0000456 IFN 101

Bank of Maharastra, Pune Bank of Maharastra, Karad Request for Transfer

36

Text Block: Field Description 20 Senders Reference No. 21 Customer Specified Reference 5 0H Ordering Customer

1.4.2. 1.4.2.

30 21 3 2B 59

Requested Execution Date Transaction Reference Currency & Amount Beneficiary

70 7 1A

Remittance Information Details of Charges

Information DR5678/2001 PYT173314 /3534981 ABC LTD 10092001 DR5678/2001 INR10,000.00 /76543 JK&CO INV. 74747 FULL SETTLEMENT BEN

Transfer Transfer is is for cred credit it of multiple multiple benefici beneficiarie ariess who also bank bank with the the branch to which the IFN 101 message is addressed.

As the beneficiaries bank with the branch to which the IFN 101 message is addressed, the funds are applied to the debit of the ordering customer. No reporting to the Bank’s Reconciliation System is involved since the movement of funds is from one account of the branch to other accounts in the same branch. Example:

On 10.09.2001, M/s. ABC Ltd request Bank of Maharastra, Pune to instruct their Karad branch to debit M/s. ABC Ltd’s account with Bank of Maharastra, Karad and transfer Rs 10,000.00 & Rs 12,000.00 same day value for credit of Account No. 76543 of JK&Co and 9211 of AN&Co. respectively with Bank of Maharastra, Karad in full settlement of Inv. 74747 and Inv. No. 24680 respectively. ABC Ltd’s reference is PYT173315. All charges are for beneficiary’s account. Bank of Maharastra, Pune Reference No. is DR5679/2001 for the IFN 101 and DR5679/01/2001 and DR5679/02/2001 for the individual transactions. The information to be provided by Bank of Maharastra, Pune to Bank of Maharastra, Karad in the IFN 101 message would be as follows: Common Information:

Sending Branch Receiving Branch Tran Transf sfer er Requ Reques estt Ref Refer eren ence ce No. Ordering Party Their Reference Value Date

: Bank of Maharastra, Pune : Bank of Maharastra, Karad : DR5 DR567 679/ 9/20 2001 01 : ABC Ltd : PYT173314 : 10.09.2001 37

Account to be debited : 3534981 Account maintained with : Bank of Maharastra, Karad Paying Bank charges charges to be borne by : Benefici Beneficiarie ariess Information relevant to individual transactions: Bank of Maharastra Pune Reference Nos. DR5679/01/2001 DR5679/02/2001

Amount

10,000.00 12,000.00

Beneficiary Account No. JK&Co. 76543 AN&Co. 9211

Payment Details for Beneficiary Full settlement Inv. 74747 Full settlement Inv. 24680

Bank of Maharastra, Pune sends an IFN 101 message to their Karad branch. On receipt of a valid IFN 101 message, Bank of Maharastra, Karad debits ABC Ltd’s account and credits JK&Co and AN&Co’s accounts and sends debit advice to the instructing party and credit advices to the beneficiaries. Message Flow: ABC LTD INSTRUCTION

DEBIT ADVICE

JK&CO

IFN 101

CREDIT ADVICE

CREDIT ADVICE

AN&CO

JK&CO’S ACCOUNT



FUNDS ABC LTD’S ACCOUNT

AN&CO’S ACCOUNT

FUNDS

38

The extract of header and text block of the IFN 101 Message sent by Bank of Maharastra, Pune to their Karad branch would be as follows: Header Block: Sender Receiver Message Type

BOMA0000001 BOMA0000456 IFN 101



30 Requested Execution Date Transaction details 1 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary 70 Remittance Information 7 1A Details of Charges Transaction details 2 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary 70 7 1A


Information DR5679/2001 PYT173315 /3534981 ABC LTD 10092001

DR5679/01/2001 INR10,000.00 /76543 JK&CO INV. 74747 FULL SETTLEMENT BEN DR5679/02/2001 INR12,000.00 /9211 AN&CO INV. 24680 FULL SETTLEMENT BEN

39

1.4.3. 1.4.3.

Transfer Transfer is is for credit credit of a single single benef beneficiar iciary y who banks banks with another another branch of the same bank. (IFN 101, 100, 900 & 910)

As the beneficiary banks with another branch of the same bank, after debiting of the ordering ordering customer’s account, the branch to which the IFN 101 message is addressed sends an IFN 100 message to the the branch which maintains the beneficiary’s account. An IFN IFN 910 message is used for reporting the inter branch credit transaction to the Bank’s Reconciliation System. The beneficiary’s branch applies funds on receipt of a valid IFN 100 10 0 message and reports the debit transaction to the Bank’s Reconciliation System using an IFN 900 message.

Example:

On 10.09.2001, M/s. ABC Ltd request Bank of Maharastra, Pune to instruct their Karad branch to debit M/s. ABC Ltd’s account with Bank of Maharastra, Karad and transfer Rs 10,000.00 same day value for credit of Account No. 56765 of GDD Ltd with Bank of Maharastra, Satara in full settlement of Inv. 89012. ABC Ltd’s reference is PYT173316. All charges are for beneficiary’s account. Bank of Maharastra, Pune Reference No. is DR5680/2001. The information to be provided by Bank of Maharastra, Pune to Bank of Maharastra, Karad in the IFN 101 message would be as follows: Sending Branch Receiving Branch Tran Transf sfer er Requ Reques estt Ref Refer eren ence ce No. Ordering Party Their Reference Amount Value Date Account to be debited Account maintained with Beneficiary Beneficiary’s Account No. Account maintained with

: Bank of Maharastra, Pune : Bank of Maharastra, Karad : DR5 DR568 680/ 0/20 2001 01 : ABC Ltd : PYT173316 : Rs 10,000.00 : 10.09.2001 : 3534981 : Bank of Maharastra, Karad : GDD Ltd : 56765 : Bank of Maharastra, Satara (IFSC say BOMA 0000123) Detail Detailss of Payment Payment for for Benefi Beneficia ciary ry : Full Full settle settlemen mentt of Inv. Inv. 89012 89012 Paying Bank charges charges to be borne by : Benefici Beneficiary ary Bank of Maharastra, Pune sends an IFN 101 message to their Karad branch. On receipt of a valid IFN 101 message, Bank of Maharastra, Karad debits ABC Ltd’s account and sends an IFN 100 message (TT Ref: TT/876/2001) to Bank of Maharastra, Satara instructing them to credit the proceeds to Account No. 56765 of GDD Ltd. An IFN 910 message is sent to the Bank’s Reconciliation System.

40

On receipt of a valid and authenticated IFN 100 message, Bank of Maharastra, Satara applies funds to GDD Ltd.’s account and reports the transaction by sending a debit report to the Bank’s Reconciliation System. Their Reference Reference is TTP/1020/2001. Message Flow:

ABC LTD INSTRUCTION

DEBIT ADVICE


IFN 101

ABC LTD’S ACCOUNT FUNDS BANK OF MAHARASTRA KARAD

GDD LTD

CREDIT ADVICE

GDD LTD’S ACCOUNT

FUNDS

IFN 100

BANK OF MAHARASTRA SATARA

IFN 910

BOM RECONCILIATION SYSTEM

IFN 900


BOMA0000001 BOMA0000456 IFN 101


41


30 21 3 2B 5 7A 59

Requested Execution Date Transaction Reference Currency & Amount Account with Institution Beneficiary

70 7 1A


Information DR5680/2001 PYT173316 /3534981 ABC LTD 10092001 DR5680/2001 INR10,000.00 BOMA0000123 /56765 GDD LTD INV. 89012 FULL SETTLEMENT BEN

The extract of header and text block of the IFN 100 Message sent by Bank of Maharastra, Karad to their Satara branch would be as follows: Header Block: Sender Receiver Message Type

BOMA0000456 BOMA0000123 IFN 100

Bank of Maharastra, Karad Bank of Maharastra, Satara Customer Transfer

Text Block: Field Description Information 20 Senders Reference No. TT/876/2001 32A 32A Valu Va luee Date, ate, Cur Currency ency & Amou Amount nt 1009 100920 2001 01IINR10 NR10,0 ,000 00.0 .00 0 50 Ordering Customer ABC LTD 59 Beneficiary /56765 GDD LTD 70 Details of payment INV. 89012 FULL SETTLEMENT 7 1A Details of Charges BEN

The extract of header and text block of the IFN 910 Message sent by Bank of Maharastra, Karad to the Reconciliation System (IFSC Say BOMA0000999) would be as follows: Header Block: Sender Receiver Message Type

BOMA0000456 BOMA0000999 IFN 910

Bank of Maharastra, Karad Bank of of Ma Maharastra Re Reconciliation Sy System Credit Advice

42


Information TT/876/2001 NONREF INTER BRANCH ACCOUNT 10092001I 01INR10,000.00 .00 BOMA0000123

The extract of header and text block of the IFN 900 Message sent by Bank of Maharastra, Satara to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

BOMA0000123 BOMA0000999 IFN 900

Bank of Maharastra, Satara Bank of of Ma Maharastra Re Reconciliation Sy System Debit Advice


1.4.4. 1.4.4.

Information TTP/1020/2001 TT/876/2001 INTER BRANCH ACCOUNT 10092001I 01INR10,000.00 .00 BOMA0000456

Transfer Transfer is is for credit credit of multiple multiple beneficiar beneficiaries ies who who bank bank with with other other branches of the bank. (IFN 100, 101, 102, 900 & 910)

As the beneficiaries bank with other branch(es) of the same bank, after debiting of the ordering customer’s account, the branch to which which the IFN 101 message is addressed sends one or more IFN 100 or IFN 102 messages to the branch(es) which maintain the beneficiaries’ accounts. IFN 910 messages are used for reporting the inter branch credit transactions to the Bank’s Reconciliation System. The beneficiaries’ branches apply funds on receipt of valid IFN 100 or IFN 102 messages and report the debit transaction(s) to the Bank’s Reconciliation System using IFN 900 message(s). Example:

On 10.09.2001, M/s. ABC Ltd request Bank of Maharastra, Pune to instruct their Karad branch to debit M/s. ABC Ltd’s account with Bank of Maharastra, Karad and transfer Rs 10,000.00 & Rs 12,000.00 same day value for credit of Account No. 76543 of JK&Co and 9211 of AN&Co. respectively with Bank of Maharastra, Satara in full settlement of Inv. 74747 and Inv. No. 24680 respectively. ABC Ltd’s reference is PYT173317. All charges are for beneficiaries’accounts.

43

Bank of Maharastra, Pune Reference No. is DR5679/2001 for the IFN 101 and DR5679/01/2001 and DR5679/02/2001 for the individual transactions. The information to be provided by Bank of Maharastra, Pune to Bank of Maharastra, Karad in the IFN 101 message would be as follows: Common Information:

Sending Branch Receiving Branch Tran Transf sfer er Requ Reques estt Ref Refer eren ence ce No. Ordering Party Their Reference Value Date Account to be debited Account maintained with Beneficiaries’ bank with Paying Bank charges charges to be borne by

: Bank of Maharastra, Pune : Bank of Maharastra, Karad : DR5 DR567 679/ 9/20 2001 01 : ABC Ltd : PYT173314 : 10.09.2001 : 3534981 : Bank of Maharastra, Karad : Bank of Maharastra, Satara : Benefici Beneficiarie ariess

Information relevant to individual transactions: Bank of Maharastra Pune Reference Nos. DR5679/01/2001 DR5679/02/2001

Amount

10,000.00 12,000.00



Bank of Maharastra, Pune sends an IFN 101 message to its Karad branch. On receipt of a valid IFN 101 message, Bank of Maharastra, Karad Karad debits ABC Ltd’s account sends a debit advice to them and sends an IFN 102 message (TT Ref: TT/877/2001) to Bank of Maharastra, Satara instructing them to credit the proceeds to Account No. 76543 of JK&Co and 9211 of AN&Co. respectively. Bank of Maharastra, Karad Reference Nos. for the individual TTs are TT/321/2001 and TT/322/2001 respectively. An IFN 910 mes sage is sent to the Bank’s Bank ’s Reconciliation System. On receipt of a valid and authenticated IFN 102 message, Bank of Maharastra, Satara applies funds to JK&Co and AN&Co’s accounts and reports the transaction by sending a debit report to the Bank’s Reconciliation System and sends credit advices to the beneficiaries. Their Reference No. is TTP/578/2001.

44

Message Flow: BANK OF MAHARASTRA PUNE

ABC LTD INSTRUCTION

DEBIT ADVICE

IFN 101

FUNDS BANK OF MAHARASTRA KARAD JK&CO

AN&CO

ABC LTD’S ACCOUNT

IFN 910

IFN 102

CREDIT ADVICE

BOM RECONCILIATION SYSTEM

CREDIT ADVICE

JK&CO’S ACCOUNT

AN&CO’S ACCOUNT

FUNDS

BANK OF MAHARASTRA SATARA

IFN 900

FUNDS


BOMA0000001 BOMA0000456 IFN 101


Text Block: Field Description 20 Senders Reference No. 21 Customer Specified Reference

Information DR5679/2001 PYT173315

45

5 0H

Ordering Customer

/3534981 ABC LTD 10092001

30 Requested Execution Date Transaction details 1 21 Transaction Reference 3 2B Currency & Amount 5 7A Account with Institution 59 Beneficiary

DR5679/01/2001 INR10,000.00 BOMA0000123 /76543 JK&CO INV. 74747 FULL SETTLEMENT BEN

70 Remittance Information 7 1A Details of Charges Transaction details 2 21 Transaction Reference 3 2B Currency & Amount 5 7A Account with Institution 59 Beneficiary 70 7 1A

DR5679/02/2001 INR12,000.00 BOMA0000123 /9211 AN&CO INV. 24680 FULL SETTLEMENT BEN


The extract of header and text block of the IFN 102 Message sent by Bank of Maharastra, Karad to their Satara branch would be as follows: Header Block: Sender Receiver Message Type

BOMA0000001 BOMA0000456 IFN 102

Bank of Maharastra, Pune Bank of Maharastra, Karad Multiple Customer Transfer

Text Block: Field Description 20 File Reference 23 Bank Operation Code 5 1A Sending Institution IFSC Code 50 Ordering Customer 7 1A Details of Charges Transaction details: 1 21 Transaction Reference 3 2B Currency & Amount 59 Beneficiary

70 Remittance Information Transaction details: 2 21 Transaction Reference 3 2B Currency & Amount

Information TT/877/2001 CREDIT IFSC BOMA0000456 M/S ABC LTD. BEN

TT/321/2001 INR10,000.00 /76543 JK&CO INV. 74747 FULL SETTLEMENT TT/322/2001 INR12,000.00

46

59

Beneficiary

/9211 AN&CO INV. 24680 FULL SETTLEMENT

70 Remittance Information Settlement details 32A 32A Valu Va luee Date, ate, Cur Currency ency & Amou Amount nt 1009 100920 2001 01IINR22 NR22,0 ,000 00.0 .00 0

The extract of header and text block of the IFN 910 Message sent by Bank of Maharastra, Karad to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

BOMA0000456 BOMA0000999 IFN 910

Bank of Maharastra, Karad Bank of of Ma Maharastra Re Reconciliation Sy System Credit Advice


Information TT/877/2001 NONREF INTER BRANCH ACCOUNT 10092001I 01INR22,000.00 .00 BOMA0000123

The extract of header and text block of the IFN 900 Message sent by Bank of Maharastra, Satara to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

BOMA0000123 BOMA0000999 IFN 900

Bank of Maharastra, Satara Bank of of Ma Maharastra Re Reconciliation Sy System Debit Advice


Information TTP/578/2001 TT/877/2001 INTER BRANCH ACCOUNT 10092001I 01INR22,000.00 .00 BOMA0000456

Though in the above example, all the beneficiaries have been shown to be banking with one branch only, more often than not, beneficiaries would be banking in s everal branches of the bank. In such s uch case, several IFN 100 messages (to those branches where wh ere only one beneficiary has an account) and IFN 102 messages (to those branches where more than one beneficiaries have accounts) accounts) will have to be sent to the concerned concerned branches. branches.

47

1.4.5. 1.4.5.

Transfer Transfer is is for credit credit of a single single benef beneficiar iciary y who banks banks with another another bank’ bank’ss branch branch in the the same same ent enter er as the the branch branch to to which which the the messag messagee is addressed. (IFN 101)

As the beneficiary banks with the branch of another bank, the branch to which the IFN 101 message is addressed uses traditional methods of payment such as pay orders. After debiting the ordering customer’s account, the receiving branch sends a pay order for proceeds favouring the beneficiary and forwards it to the beneficiary. As the funds are settled through local loc al clearing, the Bank’s Reconciliation System is not involved in settlement/reconciliation of funds. Example:

On 10.09.2001, M/s. ABC Ltd request Bank of Maharastra, Pune to instruct their Karad branch to debit M/s. M/s. ABC Ltd’s Ltd’s account with Bank of Maharastra, Karad and transfer Rs 10,000.00 same day value for credit of M/s GDD Ltd in full settlement of Inv. 89012. ABC Ltd’s reference is PYT173316. All charges are for beneficiary’s account. M/s GDD Ltd bank with Bank of India, Karad. The information to be provided by Bank of Maharastra, Pune to Bank of Maharastra, Karad in the IFN 101 message would be as follows: Sending Branch Receiving Branch Tran Transf sfer er Requ Reques estt Ref Refer eren ence ce No. No. Ordering Party Their Reference Amount Value Date Account to be debited Account maintained with Beneficiary Beneficiary’s Account No. Account maintained with Details Details of Payment for Benefi Beneficiary ciary

: Bank of Maharastra, Pune : Bank of Maharastra, Karad : DR5 DR568 680/ 0/20 2001 01 : ABC Ltd : PYT173316 : Rs 10,000.00 : 10.09.2001 : 3534981 : Bank of Maharastra, Karad : GDD Ltd : 56765 : Union Bank of India, Karad (IFSC say UBIN0000321) : Full Full settle settlement ment of Invoice Invoice 89012

Bank of Maharastra, Pune sends an IFN 101 message to their Karad branch. On receipt of a valid IFN 101 message, Bank of Maharastra, Karad debits ABC Ltd’s account and issues a pay order for the proceeds favouring M/s GDD Ltd and forwards it to the beneficiaries and sends a debit advice to M/s. ABC Ltd.

48

Message Flow:


ABC LTD INSTRUCTION

DEBIT ADVICE

GDD LTD

IFN 101


FUNDS

FUNDS

ABC LTD’S ACCOUNT


BOMA0000001 BOMA0000456 IFN 101


Text Block: Field Description 20 Senders Reference No. 21 Customer Specified Reference 5 0H Ordering Customer 30 Requested Execution Date 21 Transaction Reference 3 2B Currency & Amount 5 7A Account with Institution 59 Beneficiary 70 Remittance Information 7 1A Details of Charges

Information DR5680/2001 PYT173316 ABC LTD 10092001 DR5680/2001 INR10,000.00 UBIN0000321 GDD LTD INV. 89012 full settlement BEN

49

1.4.6. 1.4.6.

Transfer Transfer is for for credit credit of of multip multiple le benefici beneficiaries aries who bank bank with other other banks banks’’ b bran ranch ches es in the same same enter ent er as the branc branch h to to whi which ch the the message is addressed. (IFN 101)

As the beneficiaries bank with the branch to which the IFN 101 message is addressed, the funds are applied to the debit of the ordering customer. No reporting to the Bank’s Reconciliation System is involved since the movement of funds is from one account of the branch to other accounts in the same branch. Example:

On 10.09.2001, M/s. ABC Ltd request Bank of Maharastra, Pune to instruct their Karad branch to debit M/s. ABC Ltd’s account with Bank of Maharastra, Karad and transfer Rs 10,000.00 & Rs 12,000.00 same day value for credit of M/s JK&Co and M/s AN&Co. in full settlement of Inv. 74747 and Inv. No. 24680 respectively. ABC Ltd’s reference is PYT173315. All charges are for beneficiaries account. The beneficiaries bank with Bank of India, Karad. Bank of Maharastra, Pune Reference No. is DR5679/2001 for the IFN 101 and DR5679/01/2001 and DR5679/02/2001 for the individual transactions. The information to be provided by Bank of Maharastra, Pune to Bank of Maharastra, Karad in the IFN 101 message would be as follows: Common Information:

Sending Branch Receiving Branch Tran Transf sfer er Requ Reques estt Ref Refer eren ence ce No. No. Ordering Party Their Reference Value Date Account to be debited Account maintained with Beneficiaries’ bank with Paying Bank charges charges to be borne by

: Bank of Maharastra, Pune : Bank of Maharastra, Karad : DR5 DR567 679/ 9/20 2001 01 : ABC Ltd : PYT173315 : 10.09.2001 : 3534981 : Bank of Maharastra, Karad : Union Bank of India, Karad : Benefici Beneficiarie ariess

Information relevant to individual transactions: Bank of Maharastra Pune Reference Nos. DR5679/01/2001 DR5679/02/2001

Amount

10,000.00 12,000.00



50

Bank of Maharastra, Pune sends an IFN 101 message to their Karad branch. Bank of Maharastra,. On receipt of a valid IFN 101 message, Bank of Maharastra, Karad debits ABC Ltd’s account and issues pay orders for the proceeds favouring M/s JK&Co. and AN&Co. and forwards it to the beneficiaries and sends a debit advice to M/s. ABC Ltd. Message Flow: BANK OF MAHARASTRA PUNE

ABC LTD INSTRUCTION

DEBIT ADVICE

IFN 101

JK&CO FUNDS

AN&CO


FUNDS

FUNDS

ABC LTD’S ACCOUNT


BOMA0000001 BOMA0000456 IFN 101



30 Requested Execution Date Transaction details 1 21 Transaction Reference 3 2B Currency & Amount 5 7A 59 70

Account with institution Beneficiary Remittance Information

Information DR5680/2001 PYT173315 /3534981 ABC LTD 10092001

DR5680/01/2001 INR10,000.00 UBIN0000321 JK&CO INV. 74747 FULL SETTLEMENT 51

7 1A Details of Charges Transaction details 2 21 Transaction Reference 3 2B Currency & Amount 5 7A Account with institution 59 Beneficiary 70 Remittance Information 7 1A Details of Charges

BEN DR5680/02/2001 INR12,000.00 UBIN0000321 AN&CO INV. 24680 FULL SETTLEMENT BEN

1.5. 1.5. Third Third Party Party Instr Instruct uction ion or or Request Request for Debi Debitt of Customer Customer’s ’s Account. (IFN 104) A creditor or his branch may instruct or request the debtor’s branch either directly or through an intermediary branch, to debit the debtor’s account and transfer the proceeds to the creditor’s branch for credit to the creditor’s account. Whether the message represents an instruction or a request depends on the terms and conditions laid down in a special agreement executed by the debtor with the creditor and the account servicing branch. IFN 104 messages enable banks and term lending institutions in ensuring timely repayment of installments. This is achieved by stipulating at the time of granting of the loan, that the borrower should make prior arrangements with the account servicing institution to accept instructions or requests from the lender banks to transfer the installment amounts to them (lender banks).

IFN 104 message is used for relaying the instruction/request for debiting the customer and transferring of funds. The creditor’s branch sends an IFN 104 Message to the debtor’s branch. On receipt of the message, the debtor’s branch debits his account and transfers the amount to the creditor’s branch using an IFN 100 Message. On receipt of the IFN 100 Message, the creditor’s branch applies funds to his account.

As such, it will be necessary to agree on the format of the mandate and also draw up country specific message usage rules before b efore implementing this message type.

52

1.6. DD Related Related Messages. Messages. At present, there are three IFN Message Formats for relaying of information pertaining to DD related transactions.

1.6. 1.6.1. 1.

DD Advi Advice ces. s. (IFN IFN 110 110))

IFN 110 messages are used us ed for relaying single or multiple DD advices. Example:

On 15.10.2001, Bank of India, Surat has drawn following DDs on Bank of India, Lucknow. DD No. 300007 300023 300045

Amount (Rs.) 1,50,000.00 1,00,000.00 2,20,000.00

Payee FGH Ltd. SD&Co. ABC Charitable Trust

The extract of header and text block of the IFN 110 message sent by Bank of India, Surat would be as follows: Header Block: Sender Receiver Message Type

BKID0000101 BKID0000756 IFN 110

Text Block: Field Description 20 Transaction Reference No. Transaction details 1. 21 DD Number 30 Date of Issue 3 2B Currency & Amount 59 Payee Transaction details 2. 21 DD Number 30 Date of Issue 3 2B Currency & Amount 59 Payee Transaction details 3. 21 DD Number 30 Date of Issue 3 2B Currency & Amount 59 Payee

Bank of India, Surat Bank of India, Lucknow. Advice of Cheque (DD)

Information DD ADVICES

300007 15102001 INR1,50,000.00 FGH LTD 300023 15102001 INR1,00,000.00 SD&CO. 300045 15102001 INR2,20,000.00 ABC CHARITABLE TRUST

53

1.6.2. 1.6.2.

DD Stop Stop Paymen Paymentt Reques Requests. ts. (IFN (IFN 111) 111)

IFN 111 messages are used for relaying DD stop payment requests. Example:

On 25.10.2001, the purchaser of DD No. 300045 reported to Bank of India, Surat that the DD in question appeared to have been lost in transit and requested for issue a duplicate in lieu. Bank of India, Surat sends an IFN 111 to the drawee branch requesting for stop payment of the DD. The extract of header and text block of the IFN 111 message sent by Bank of India, Surat would be as follows: Header Block: Sender Receiver Message Type

BKID0000101 BKID0000756 IFN 111

Text Block: Field Description 20 Transaction Reference No. 21 DD Number 30 Date of Issue 3 2B Currency & Amount 59 Payee 75 Reason for stop payment

CODE: /21/

1.6.3. 1.6.3.

Bank of India, Surat Bank of India, Lucknow. Request for Stop Payment

Information DD STOP PAYMENT 300045 15102001 INR2,20,000.00 ABC CHARITABLE TRUST /21/

DD lost or st stolen

Replie Repliess to DD DD Stop Stop Paym Payment ent Reques Requests. ts. (IFN (IFN 112) 112)

IFN 112 messages are used for replying to DD stop payment requests. Example 1:

On 26.10.2001, Bank of India, Lucknow responds to the stop request by sending an IFN 112 message advising that the DD is still unpaid and that the stop payment request has been noted. The extract of header and text block of the IFN 112 message sent by Bank of India, Lucknow would be as follows:

54


BKID0000756 BKID0000101 IFN 112

Text Block: Field Description 20 Transaction Reference No. 21 DD Number 30 Date of Issue 3 2B Currency & Amount 59 Payee 76 Reply

CODE:

/13/

Bank of India, Lucknow. Bank of India, Surat Reply to Request for Stop Payment

Information DD STOP PAYMENT 300045 15102001 INR2,20,000.00 ABC CHARITABLE TRUST /13/

Stop payment instruction duly recorded

Example 2:

On 26.10.2001, Bank of India, Lucknow responds to the stop request by sending an IFN 112 message advising that the stop payment payment request cannot be accepted as the DD has already been paid on 20.10.2001. The extract of header and text block of the IFN 112 message sent by Bank of India, Lucknow would be as follows: Header Block: Sender Receiver Message Type

BKID0000756 BKID0000101 IFN 112

Text Block: Field Description 20 Transaction Reference No. 21 DD Number 30 Date of Issue 3 2B Currency & Amount 59 Payee 76 Reply

CODE:

12/ /12/

Bank of India, Lucknow. Bank of India, Surat Reply to Request for Stop Payment

Information DD STOP PAYMENT 300045 15102001 INR2,20,000.00 ABC CHARITABLE TRUST /12/DD PAID IN CLEARING ON 20.10.2001.

Stop Stop paym paymen entt inst instru ruct ctio ions ns not acce accept ptab able le

55

2. Inter-Branc Inter-Branch h Messages involvin involving g Intra-Bank and InterInterBank Transfer of Funds: Often, branches of the same bank exchange messages, which involve transfer of funds to or receipt of funds from another branch of the same bank or another bank. There are several IFN message formats available for relaying such messages. Various scenarios involving such messages have been discussed below:

2.1. Request for transfer of funds funds from DAD account of one branch to another. (IFN 202, 210, 900 & 910) The branch requesting for transfer of funds sends an IFN 202 message to the branch that is being requested requested to transfer transfer the funds. funds. The receiver receiver of the message transfers transfers the amount by the the traditional method of sending to the local RBI DAD, an RBI cheque for the amount with the RBI TT requisition slip requesting transfer of funds. Example:

On 10.10.2001, Canara Bank, Chennai sends an IFN 202 message to Canara Bank, New Delhi requesting transfer of Rs 10 Crores same day value from DAD account of Canara Bank with RBI, New Delhi to DAD account (No. 987654) of Canara Bank with RBI, Chennai. Canara Bank, Chennai also sends an IFN 910 message to the Bank’s Reconciliation System. Their Reference No. is TRF/789/2001. Canara Bank, Chennai also sends an IFN 210 message to RBI Chennai advising them that it expects Rs 10 crores to be credited same day value into its Account No. 987654 through Canara Bank, New Delhi and RBI, New Delhi. On receipt receipt of a valid and authenticated authenticated IFN 202 message, message, Canara Bank, New Delhi Delhi Branch arranges with RBI New Delhi to transfer funds as requested sends an IFN 900 message to Canara Bank, Chennai advising them that the funds have been transferred and reports the transaction by sending an IFN 900 message to the Bank’s Reconciliation System. Their Reference No. is TTP/1357/2001 It is assumed that the IFSCs of the various various entities are as follows: follows: Canara Bank Chennai Canara Bank New Delhi Canara Canara Bank Reconciliati Reconciliation on System System RBI, Chennai RBI, New Delhi

: CNRB0000321 : CNRB0000654 : CNRB00099 CNRB0009999 99 : RBIN0000CHN : RBIN0000DEL

56

Message Flow: RBI CHENNAI A/C CANARA BANK

IFN 210

CANARA BANK CHENNAI

F U N D S

RBI NEW DELHI A/C CANARA BANK

IFN 900

RBI CHEQUE & TT REQUEST

IFN 202

IFN 910

CANARA BANK RECONCILIATION SYSTEM

CANARA BANK NEW DELHI

IFN 900

The extract of header and text block of the IFN 202 Message sent by Canara Bank, Chennai to Canara Bank, New Delhi Branch would be as follows: Header Block: Sender Receiver Message Ty Type

CNRB0000321 CNRB0000654 IFN 20 202

Canara Bank Chennai Canara Bank New Delhi General Financial In Institution Tr Transfer

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 32A 32A Valu Va luee Dat Datee Cur Currrency ency & Amo Amoun untt 5 4A Receiver’s Co Correspondent 5 7A Account With Institution 5 8A Beneficiary Institution

Information TRF/789/2001 NONREF 1010 101020 2001 01IINR10 NR10,0 ,00, 0,00 00,0 ,000 00.0 .00 0 RBIN0000NDL RBIN0000CHN CNRB0000321

The extract of header and text block of the IFN 910 Message sent by Canara Bank, Chennai to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

CNRB0000321 CNRB0009999 IFN 910

Canara Bank Chennai Canara Bank Reconciliation System Credit Advice

57

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Valu Va luee Dat Datee Cur Currrency ency & Amo Amoun untt 5 2A CONTRA PA PARTY BR BRANCH

Information TRF/789/2001 NONREF INTER BRANCH ACCOUNT 1010 101020 2001 01IINR10 NR10,0 ,00, 0,00 00,0 ,000 00.0 .00 0 CNRB0000654

The extract of header and text block of the IFN 210 Message sent by Canara Bank Chennai to RBI, Chennai would be as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 25 30 21 3 2B 5 2A 5 6A

CNRB0000321 RBIN0000CHN IFN 210

Canara Bank Chennai RBI, Chennai Notice to Receive

Description Transaction Reference No. Account Identification Value Date Related Reference Currency & Amount Ordering Institution Intermediary

Information TRF/789/2001 987654 10102001 TRF/789/2001 10102001INR10,00,00,000.00 CNRB0000654 RBIN0000NDL

The extract of header and text block of the IFN 900 Message sent by Canara Bank, New Delhi Branch to Canara Bank, Chennai would be as follows: Header Block: Sender Receiver Message Type

CNRB0000654 CNRB0000321 IFN 900

Canara Bank, New Delhi Canara Bank , Chennai Debit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Valu Va luee Dat Datee Cur Currrency ency & Amo Amoun untt

Information TTP/1357/2001 TRF/789/2001 INTER BRANCH ACCOUNT 1010 101020 2001 01IINR10 NR10,0 ,00, 0,00 00,0 ,000 00.0 .00 0

58

The extract of header and text block of the IFN 900 Message sent by Canara Bank, New Delhi Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

CNRB0000654 CNRB0009999 IFN 900

Canara Bank, New Delhi Canara Bank Reconciliation System Debit Advice


Information TTP/1357/2001 TRF/789/2001 INTER BRANCH ACCOUNT 1010 101020 2001 01IINR10 NR10,0 ,00, 0,00 00,0 ,000 00.0 .00 0 CNRB0000321

2.2. 2.2. Reques Requestt for transf transfer er of funds funds from from DAD acco account unt of of one branc branch h to DAD account of two or more branches. (IFN 203, 210, 900 & 910) Funds Managers can send an IFN 203 message to a branch of the Bank requesting it to transfer funds to DAD accounts of 2 or more branches of the same bank. IFN 210 messages are sent to each of the branches whose DAD account is being credited to advise them that their DAD accounts are being funded. The receiver of the 203 message uses traditional means for transferring the amounts to the DAD accounts of the concerned branches and uses IFN 900 messages to advise the branches branches whose DAD accounts are being funded. IFN 900 messages are also used to relay debit advices to the Bank’s Reconciliation System. Receivers of IFN 210 messages ensure that the funds are credited credited to their DAD accounts and send IFN 910 messages to advise the Bank’s Reconciliation System of the credits. Example:

On 10.10.2001, Central Funds Dept., Canara Bank sends an IFN 203 message to Canara Bank, New Delhi requesting transfer of Rs 25 Crores same day value from DAD account of Canara Can ara Bank with RBI, New Delhi to various DAD accounts ac counts of Canara Bank as detailed below. DAD aaccount ccount with RBI, Chennai Chennai – Rs 10 Crore Croress DAD aaccount ccount with RBI, Mumbai Mumbai – Rs 8 Crores Crores DAD aaccount ccount with RBI, Kolkata Kolkata – Rs 7 Crores Crores Central Funds Dept., Canara Bank also sends an IFN 210 message each to the above three branches with Reference Nos. FND/567/2001, FND/568/2001 and FND/569/2001 respectively which are also the Reference Nos. for individual transactions in the IFN 203 message.

59

On receipt of a valid and authenticated IFN 203 message, Canara Bank, New Delhi Branch arranges with RBI New Delhi to transfer funds as requested and reports the transaction by sending IFN 900 messages to the Bank’s Reconciliation System. It also sends IFN 300 messages to the branches branches whose DAD accounts accounts are being funded. funded. On receipt of valid IFN 210 messages from the funds department, the recipient branches in turn send IFN 210 messages to the local RBI offices advising them that their accounts are being funded. The branches ensure that their respective DAD accounts have been credited and send IFN 910 messages to the Bank’s Reconciliation System, advising the credits. It is assumed that the IFSC codes of the various entities are as follows: Canara Bank Chennai : CNRB0000321 Canara Ba Bank Kolkata : CNRB0000789 Canara Bank Mumbai : CNRB0000876 Canara Bank New Delhi : CNRB0000654 Cana Canarra Bank ank Fund Fundss De Depa part rtme ment nt : CNRB CNRB00 0005 0555 555 5 Canara Bank RBI, Chennai : RBIN0000CHN RBI, Kolkata : RBIN0000CAL RBI, Mumbai : RBIN0000MUM RBI, New Delhi : RBIN0000NDL And Account Nos. of Canara Bank’s accounts with various RBI Offices are as follows: RBI, Chennai RBI, Kolkata RBI, Mumbai RBI, New Delhi

: CHNCAN135 : CALCAN357 : MUMCAN579 : NDLCAN791

60

Message Flow:

IFN 210 IFN 210

CANARABANK FUNDS DEPT.

IFN 210

CANARA BANK CANARA CHENNAI BANK CANARA MUMBAI BANK KOLKATA

IFN 210

IFN 910

IFN 900

IFN 910

IFN 210 IFN 210

IFN 910

IFN 900 IFN 900 IFN 203

CANARA BANK RECONCILIATION SYSTEM

CANARA BANK NEW DELHI

IFN 900

IFN 900

IFN 900

RBI CHENNAI A/C CANARA RBI MUMBAI BANK RBI KOLKATA A/C CANARA BANK A/C CANARA BANK

F U N D S

F U N D S

F U N D S

RBI N. DELHI A/C CANARA BANK

RBI CHEQUE & TT REQUEST

The extract of header and text block of the IFN 203 Message sent by Central Funds Dept., Canara Bank to Canara Bank, New Delhi Branch would be as follows: Header Block: Sender Receiver Message Type Text Block: Field 19 30 5 4A

CNRB0005555 CNRB0000654 IFN 203

Canara Bank, Central Funds De Dept. Canara Bank, New Delhi Branch Multiple Financial Institution Transfer

Description Sum of Amounts Value Date Receiver’s Correspondent

Information 25,00,00,000.00 10102001 RBIN0000NDL

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Transaction Details 1 20 Transaction Reference No. 3 2B Currency & Amount 5 7A Account With Institution 5 8A Beneficiary Institution Transaction Details 2 20 Transaction Reference No. 3 2B Currency & Amount 5 7A Account With Institution 5 8A Beneficiary Institution Transaction Details 3 20 Transaction Reference No. 3 2B Currency & Amount 5 7A Account With Institution 5 8A Beneficiary Institution

FND/567/2001 10102001INR10,00,00,000.00 RBIN0000CHN CNRB0000321 FND/568/2001 10102001INR8,00,00,000.00 RBIN0000MUM CNRB0000876 FND/569/2001 10102001INR7,00,00,000.00 RBIN0000CAL CNRB0000789

The extract of header and text block of the IFN 210 Message sent by Central Funds Dept., Canara Bank to Canara Bank Chennai, would be as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 25 30 21 3 2B 5 2A

CNRB0005555 CNRB0000321 IFN 210

Canara Bank, Central Funds Dept. Canara Bank, Chennai Branch Notice to Receive

Description Transaction Reference No. Account Identification Value Date Related Reference Currency & Amount Ordering Institution

Information FND/567/2001 RBIN0000CHN 10102001 FND/567/2001 10102001INR10,00,00,000.00 CNRB0000654

The extract extract of header and text block block of the IFN 210 Message Message sent by Central Central Funds Dept., Dept., Canara Bank to Canara Bank Mumbai, would be as follows: Header Block: Sender Receiver Message Type

CNRB0005555 CNRB0000876 IFN 210

Canara Bank, Central Funds Dept. Canara Ba Bank, Mumbai Br Branch Notice to Receive

Text Block: Field Description 20 Transaction Reference No. 25 Account Identification

Information FND/568/2001 RBIN0000MUM

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30 21 3 2B 5 2A

Value Date Related Reference Currency & Amount Ordering Institution

10102001 FND/568/2001 10102001INR8,00,00,000.00 CNRB0000654

The extract of header and text block of the IFN 210 Message sent by Central Funds Dept., Canara Bank to Canara Bank Kolkata, would be as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 25 30 21 3 2B 5 2A

CNRB0005555 CNRB0000789 IFN 210

Canara Bank, Central Funds Dept. Canara Bank, Kolkata Branch Notice to Receive


Information FND/569/2001 RBIN0000CAL 10102001 FND/569/2001 10102001INR7,00,00,000.00 CNRB0000654

The extract of header and text block of the IFN 210 Message sent by Canara Bank Chennai, to RBI, Chennai would be as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 25 30 21 3 2B 5 2A

CNRB0000321 RBIN0000CHN IFN 210

Canara Bank, Chennai Branch RBI, Chennai Notice to Receive


Information FND/567/2001 CHNCAN135 10102001 FND/567/2001 10102001INR10,00,00,000.00 CNRB0000654

The extract of header and text block of the IFN 210 Message sent by Canara Bank Mumbai, to RBI, Mumbai would be as follows:

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Header Block: Sender Receiver Message Type Text Block: Field 20 25 30 21 3 2B 5 2A

CNRB0000876 Canara Bank, Mumbai Branch RBIN0000MUM RBI, Mumbai IFN 210 Notice to Receive


Information FND/568/2001 MUMCAN579 10102001 FND/568/2001 10102001INR8,00,00,000.00 CNRB0000654

The extract of header and text block of the IFN 210 Message sent by Canara Bank Kolkata, to RBI Kolkata would be as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 25 30 21 3 2B 5 2A

CNRB0000789 RBIN0000CAL IFN 210

Canara Bank, Kolkata Branch RBI, Kolkata Notice to Receive


Information FND/569/2001 CALCAN357 10102001 FND/569/2001 10102001INR7,00,00,000.00 CNRB0000654

The extract of header and text block of the IFN 910 Message sent by Canara Bank, Chennai to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

CNRB0000321 CNRB0009999 IFN 910

Canara Bank, Chennai Branch Canara Bank Reconciliation System Credit Advice

64


Information TRF/567/2001 TRF/567/2001 INTER BRANCH ACCOUNT 1010 101020 2001 01IINR10 NR10,0 ,00, 0,00 00,0 ,000 00.0 .00 0 CNRB0000654

The extract of header and text block of the IFN 910 Message sent by Canara Bank, Mumbai to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

CNRB0000876 CNRB0009999 IFN 910

Canara Bank, Mumbai Branch Canara Bank Reconciliation System Credit Advice


Information TRF/568/2001 TRF/568/2001 INTER BRANCH ACCOUNT 1010 101020 2001 01IINR8, NR8,00 00,0 ,00, 0,00 000. 0.00 00 CNRB0000654

The extract of header and text block of the IFN 910 Message sent by Canara Bank, Kolkata to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

CNRB0000789 CNRB0009999 IFN 910

Canara Bank, Kolkata Branch Canara Bank Reconciliation System Credit Advice


Information TRF/569/2001 TRF/569/2001 INTER BRANCH ACCOUNT 1010 101020 2001 01IINR7, NR7,00 00,0 ,00, 0,00 000. 0.00 00 CNRB0000654

The extract of header and text block of the IFN 900 Messages sent by Canara Bank, New Delhi Branch to Canara Bank, Chenai would be as follows:

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CNRB0000654 CNRB0000321 IFN 900

Canara Bank, New Delhi Branch Canara Bank, Chennai Debit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Valu Va luee Dat Datee Cur Currrency ency & Amo Amoun untt

Information TRF/567/2001 NONREF INTER BRANCH ACCOUNT 1010 101020 2001 01IINR10 NR10,0 ,00, 0,00 00,0 ,000 00.0 .00 0

The extract of header and text block of the IFN 900 Messages sent by Canara Bank, New Delhi Branch to Canara Bank, Mumbai would be as follows:


CNRB0000654 CNRB0000876 IFN 900

Canara Bank, New Delhi Branch Canara Bank, Mumbai Debit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Valu Va luee Date ate Cur Currency ency & Amou Amount nt

Information TRF/568/2001 NONREF INTER BRANCH ACCOUNT 1010 101020 2001 01IINR8, NR8,00 00,0 ,00, 0,00 000. 0.00 00

The extract of header and text block of the IFN 900 Messages sent by Canara Bank, New Delhi Branch to Canara Bank, Kolkata would be as follows:


CNRB0000654 CNRB0000789 IFN 900

Canara Bank, New Delhi Branch Canara Bank, Kolkata Debit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Valu Va luee Date ate Cur Currency ency & Amou Amount nt

Information TRF/569/2001 NONREF INTER BRANCH ACCOUNT 1010 101020 2001 01IINR7, NR7,00 00,0 ,00, 0,00 000. 0.00 00

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The extract of header and text block of the IFN 900 Messages sent by Canara Bank, New Delhi Branch to the Reconciliation System would be as follows: 1. Header Block: Sender Receiver Message Type

CNRB0000654 CNRB0009999 IFN 900

Canara Bank, New Delhi Branch Canara Bank Reconciliation System Debit Advice


2. Header Block: Sender Receiver Message Type

CNRB0000654 CNRB0009999 IFN 900


Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Valu Va luee Da Date te Cur Currenc rency y & Amoun mountt 5 2A CONTRA PA PARTY BR BRANCH

3. Header Block: Sender Receiver Message Type

CNRB0000654 CNRB0009999 IFN 900

Information TRF/567/2001 NONREF INTER BRANCH ACCOUNT 1010 101020 2001 01IINR10 NR10,0 ,00, 0,00 00,0 ,000 00.0 .00 0 CNRB0000321

Information TRF/568/2001 NONREF INTER BRANCH ACCOUNT 1010 101020 2001 01IINR8, NR8,00 00,0 ,00, 0,00 000. 0.00 00 CNRB0000876



Information TRF/569/2001 NONREF INTER BRANCH ACCOUNT 1010 101020 2001 01IINR7, NR7,00 00,0 ,00, 0,00 000. 0.00 00 CNRB0000789

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2.3. 2.3. Reques Requestt for trans transfer fer of fun funds ds from from one bank bank’s ’s branc branch h to another bank’s branch. (IFN 202, 201, 900 & 910) IFN 202 messages can be used to instruct a branch to transfer funds using traditional methods to another Bank’s branch. Usually the proceeds of such remittances represent shortfalls in current accounts maintained by bank branches with the branch of another bank, which maintains the clearing house in the centre where the branch requesting transfer of funds is located. Example:

On 15.10.2001, Bank of Baroda, Mysore sends an IFN 202 message to Bank of Baroda, Mumbai requesting transfer of Rs 2 Crores same day value to State Bank of India, Mumbai. The proceeds represent funds borrowed by Bank of Baroda, Mysore from State Bank of India, Mysore (which manages the Mysore Bankers’ Clearing House) to make up the short fall in the current account maintained by Bank of Baroda, Mysore with State Bank of India, Mysore. Bank of Baroda, Mysore also sends an IFN 910 message to the Bank’s Reconciliation System. Their Reference No. is TTDISC/234/2001. State Bank of India, Mysore sends an IFN 210 message with Reference No. TTRECV/765/2001 to State Bank of India, Mumbai advising that a sum of Rs 2 Crores same day value is expected to be credited to the latter’s account by Bank of Baroda, Mumbai. On receipt of a valid and authenticated IFN 202 message, Bank of Baroda, Mumbai arranges to transfer funds as requested using traditional means and reports the transaction by sending an IFN 900 message to the Bank’s Reconciliation System. It also sends an IFN 900 message to its Mysore Branch advising that the transfer request has been executed. Their Reference No. is TTP/2468/2001 On receipt of funds, State Bank of India, Mumbai cross checks the amount and particulars with the information contained contained in the IFN 210 message to ascertain ascertain that the expected amount is received in full and sends an IFN 910 message to the Bank’s Reconciliation System. It also sends an IFN 910 message to State Bank of India, Mysore confirming receipt of funds. State Bank of India, Mysore responds to the IFN 910 message by sending an IFN 900 message to the Bank’s Reconciliation System. SBI Mumbai Reference No. is TTR/3542/2001 TTR/3542/2001 It is assumed that the IFSC codes of the various entities are as follows: Bank of of Baroda, Mysore Bank of Baroda, Mumbai Bank ank of of Bar Barod odaa Rec Recon onci cili liat atio ion n Sy System stem State Bank of India, Mysore State Bank of India, Mumbai State State Bank Bank of of Indi Indiaa Recon Reconcil ciliat iation ion System System

: BARB0000MYS : BARB0000MUM : BAR BARB B0000 0000RE REC C : SBIN0000876 : SBIN0000001 : SBIN00 SBIN00099 09999 99

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Message Flow:

BOB MYSORE A/C WITH SBI MYSORE

BOB MYSORE

F U N D S

IFN 900

BOB MUMBAI

SBI MYSORE

IFN 210

IFN 900

IFN 202

IFN 910

BANK OF BARODA RECONCILIATION SYSTEM

IFN 900

F U N D S

IFN 910

SBI MUMBAI

SBI RECONCILIATION SYSTEM

IFN 910

The extract of header and text block of the IFN 202 Message sent by Bank of Baroda, Mysore to Bank of Baroda, Mumbai would be as follows: Header Block: Sender Receiver Message Type

BARB0000MYS Bank of Baroda, Mysore BARB0000MUM Bank of Baroda, Mumbai IFN 202 General Financial Institution Transfer

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Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 32A 32A Valu Va luee Date ate Cur Currency ency & Amou Amount nt 5 3D Sender’s Correspondent

5 8A

Beneficiary Institution

Information TTDISC/234/2001 NONREF 1510 151020 2001 01IINR2, NR2,00 00,0 ,00, 0,00 000. 0.00 00 OUR DAD ACCOUNT WITH RBI MUMBAI SBIN0000001

The extract of header and text block of the IFN IFN 910 Message sent by Bank of Baroda, Mysore to Bank of Baroda’s Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

BARB0000MYS Bank of Baroda, Mysore BARB0000REC Bank of Baroda Reconciliation System IFN 910 Credit Advice


Information TTDISC/234/2001 TTDISC/234/2001 INTER BRANCH ACCOUNT 1510 151020 2001 01IINR2, NR2,00 00,0 ,00, 0,00 000. 0.00 00 BARB0000MUM

The extract of header and text block of the IFN 210 Message sent by State Bank of India, Mysore to State Bank of India, Mumbai would be as follows: Header Block: Sender Receiver Message Type

SBIN0000876 SBIN0000001 IFN 210

Text Block: Field Description 20 Transaction Re Reference No No. 30 Value Date 21 Related Reference 25 Account Identification

3 2B 5 2A

Currency & Amount Ordering Institution

State Bank of India, Mysore State Bank of India, Mumbai Notice to Receive

Information TTRECV/765/2001 15102001 TTRECV/765/2001 OUR DAD ACCOUNT WITH RBI MUMBAI INR2,00,00,000.00 BARB0000MYS

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The extract of header and text block of the IFN 900 Message sent by Bank of Baroda, Mumbai to Bank of Baroda Mysore would be as follows: Header Block: Sender Receiver Message Type

BARB0000MUM Bank of Baroda, Mumbai BARB0000MYS Bank of Baroda, Mysore IFN 900 Debit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification

32A 32A

Valu Va luee Date ate Cur Currency ency & Amou Amount nt

Information TTP/2468/2001 TTDISC/234/2001 OUR DAD ACCOUNT WITH RBI MUMBAI 1510 151020 2001 01IINR2, NR2,00 00,0 ,00, 0,00 000. 0.00 00

The extract of header and text block of the IFN 900 Message sent by Bank of Baroda, Mumbai to Bank of Baroda’s Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

BARB0000MUM Bank of Baroda, Mumbai BARB0000REC Bank of Baroda Reconciliation System IFN 900 Debit Advice


Information TTP/2468/2001 TTDISC/234/2001 INTER BRANCH ACCOUNT 1510 151020 2001 01IINR2, NR2,00 00,0 ,00, 0,00 000. 0.00 00 BARB0000MYS

The extract extract of header header and text block of the the IFN 910 Message Message sent by State Bank Bank of India, India, Mumbai to State Bank of India’s Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

SBIN0000001 SBIN0009999 IFN 910

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference

State Bank of India, Mumbai State Bank of In India Reconciliation sy system Credit Advice

Information TTR/3542/2001 TTRECV/765/2001

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25 32A 32A 5 2A

Account Identification Valu Va luee Date ate Cur Currency ency & Amou Amount nt CONTRA PA PARTY BR BRANCH

INTER BRANCH ACCOUNT 1510 151020 2001 01IINR2, NR2,00 00,0 ,00, 0,00 000. 0.00 00 SBIN0000876

The extract of header and text block of the IFN 910 Message sent by State Bank of India, Mumbai to State Bank of India, Mysore would be as follows: Header Block: Sender Receiver Message Type

SBIN0000001 SBIN0000876 IFN 910

State Bank of India, Mumbai State Bank of India, Mysore Credit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification

32A 32A 5 2A 5 6A

Valuee Date Valu ate Cur Currency ency & Amou Amount nt Ordering Institution Intermediary

Information TTR/3542/2001 TTRECV/765/2001 OUR DAD ACOUNT WITH RBI MUMBAI 1510 151020 2001 01IINR2, NR2,00 00,0 ,00, 0,00 000. 0.00 00 BARB0000MYS BARB0000MUM

The extract of header and text block of the IFN 900 Message sent by State Bank of India, Mysore to State Bank of India’s Reconciliation System would be as follows:

Field 20 21 25 32A 32A 5 2A

2.4. 2.4.

Description Transaction Reference No. Related Reference Account Identification Valu Va luee Date ate Cur Currency ency & Amou Amount nt CONTRA PA PARTY BR BRANCH

Information TTR/3542/2001 TTRECV/765/2001 INTER BRANCH ACCOUNT 1510 151020 2001 01IINR2, NR2,00 00,0 ,00, 0,00 000. 0.00 00 SBIN0000001

Advanc Advancee Notic Noticee of Funds Funds Expecte Expected d to be Rece Receive ived. d. (IFN (IFN 210)

Branches can use IFN 210 messages to advice another branch to give advance notice of funds expected to be credited by another branch of the same bank or another bank. Examples of such messages and the message flows have been illustrated in sections 2.1, 2.2 and 2.3 above.

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3. Collec Collectio tions: ns: SFMS has several message types for relaying information relating to collection bills. All such messages belong to category 4 of IFN IFN viz., they all begin with the number 4 such as 400, 410, 430 etc. Interpretation of information provided in all category 4 messages is subject to ICC Uniform Rules for Collections. Some of the possible uses of SFMS message types in relaying information relating to collection bill transactions have been detailed below:

3.1. Acknowledgement of Receipt of Collection Bills. Bills. (IFN 410) IFN 410 messages are used for relaying acknowledgement of receipt of one or more collection bills. Example:

M/s Baroda Supari Supplies who bank with Corporation Bank, Baroda purchases supari regularly from M/s SK Supari Co. whose bankers are Corporation Bank, Udupi. On 15.10.2001, M/s SK Supari Co. submits documents relating to their bill No. BSS/654/2001 to their bankers. The details of the bil1 are as follows. Drawee Bill Date Amount Terms Tenor

: M/s Baroda Supari Supplies : 15.10.2001 : Rs 1,00,000/: Documents against Acceptance : 60 days from bill date

Corporation Bank, Udupi sends the bill under their Reference No. OBC/791/2001 to their Baroda branch. Corporation Bank Receives the bill. Its Reference No. is IBC/680/2001. While acknowledging the Bill, Corporation Bank, Baroda will have to furnish the following details: Sender of the Message

: Corporation Bank, Baroda (IFSC say CORP0000456) Receiver of the Message : Corporation Bank, Udupi (IFSC say CORP0000321) Sender’s Reference No. : IBC/680/2001 Receiver’s Reference No. : OBC/791/2001 Bill Amount : Rs 1,00,000.00 Tenor : 60 days from Date of Bill of Exchange Corporation Bank, Baroda sends an IFN 410 message to their Udupi branch acknowledging receipt of the collection bill and enclosures. 73

Message Flow:

SK SUPARI CO

CORPORATION BANK UDUPI

DOCUMENTS

D O C U M E N T S

IFN 410

CORPORATION BANK BARODA

The Extract of header and text block of the IFN 410 message sent by Corporation Bank, Baroda to their Udupi branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2K

(1) (1) (2)

CORP0000456 CORP0000321 IFN 410

Corporation Bank, Ba Baroda Corporation Bank, Udupi Acknowledgement

Description Transaction Reference No. Related Reference (1) Amount Acknowledged

Information IBC/680/2001 OBC/791/2001 D060BEINR1,00,000.00 (2)

Corp Corpor orat atio ion n Ban Bank, k, Udu Udupi pi Refe Refere renc ncee No. No. 60 D (Day (Days) s) from from BE BE (Dat (Datee of of the the Bill Bill of Exchan Exchange ge viz., 15.10.2 15.10.2001 001))

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3.2. Advice Advice of Acceptance: Acceptance: (IFN 412) IFN 412 messages are used to relay advices of acceptance. Example:

Let us assume that in the example quoted in section 3.1 above, the drawees accepted the bill. While advising their Udipi branch, Corporation Bank, Baroda will have to furnish the following details: Sender of the Message Receiver of the Message Sender’s Reference No. Receiver’s Reference No. Bill Amount Due Date (1)

: Corporation Bank, Baroda : Corporation Bank, Udupi : IBC/680/2001 : OBC/791/2001 : Rs 1,00,000.00 : 15.12.2001

(1) As the due date has been crystallized, tenor need not be indicated Corporation Bank, Baroda would then send an IFN 412 message to Corporation Bank, Udupi advising them of acceptance. Message Flow:

SK SUPARI CO

DOCUMENTS

CORPORATION BANK UDUPI D O C U M E N T S

BARODA SUPARI SUPPLIES

PRESENTATION

ACCEPTANCE

IFN 412


75

The Extract of header and text block of the IFN 412 message sent by Corporation Bank, Baroda to their Udupi branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2A

CORP0000456 CORP0000321 IFN 412

Corporation Bank, Ba Baroda Corporation Bank, Udupi Advice of Acceptance

Description Information Transaction Reference No. IBC/680/2001 Related Reference OBC/791/2001 Maturity, Currency, Amount 15122001INR1,00,000.00 Accepted

3.3. Tracer (Fate (Fate Enquiry): Enquiry): (IFN 420) IFN 420 messages are used to enquire fate of bills sent for collection. Example:

Let us assume that in the example quoted in section 3.1 above, Corporation Bank, Udupi, did not receive advice of acceptance within a reasonable period. They would then send an IFN 420 message to Corporation Bank, Baroda requesting them to advise fate. The information to be provided in the message will be as follows: Sender of the Message Receiver of the Message Sender’s Reference No. Receiver’s Reference No. Bill Amount Tenor

: Corporation Bank, Udupi : Corporation Bank, Baroda : OBC/791/2001 : IBC/680/2001 : Rs 1,00,000.00 : 60 days from Date of Bill of Exchange

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Message Flow:

SK SUPARI CO


DOCUMENTS

D O C U M E N T S

IFN 420


The Extract of header and text block of the IFN 420 message sent by Corporation Bank, Udupi to their Baroda branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2K

CORP0000321 CORP0000456 IFN 420

Corporation Bank, Udupi Corporation Bank, Baroda Tracer

Description Transaction Reference No. Related Reference Amount Traced

Information OBC/791/2001 IBC/680/2001 D060BEINR1,00,000.00

3.4. Advice of Fate and Request for Instructions: Instructions: (IFN 422) IFN 422 messages are used to relay advices of fate and request for instructions. Though this message is normally sent in response to a tracer, it could also be sent as an advice of non payment/non-acceptance without waiting for a tracer.

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Example:

Let us assume that in the example quoted in section 3.1 above, the drawees refused to accept the bill demanding that the tenor of the bill be changed to 90 days instead of 60 days from the date of the bill of exchange. Corporation Bank, Baroda would then send an IFN 422 message to Corporation Corporation Bank, Bank, Udupi advising advising them of non-acceptance, non-acceptance, reasons reasons thereof, thereof, seeking fresh fresh instructions. While advising their Udipi branch, Corporation Bank, Baroda will have to furnish the following details: Sender of the Message Receiver of the Message Sender’s Reference No. Receiver’s Reference No. Bill Amount Tenor Reason fo for non non--acce cceptance nce

: Corporation Bank, Baroda : Corporation Bank, Udupi : IBC/680/2001 : OBC/791/2001 : Rs 1,00,000.00 : 60 days from Date of Bill of Exchange : Dr Drawees wa want th the te tenor of th the bil bill be be cha chang ngeed to to 90 90 day dayss instead of 60 days from the date of the bill of exchange

Message Flow:


SK SUPARI CO DOCUMENTS

D O C U M E N T S


PRESENTATION

NON-ACCEPTANCE

IFN 420

IFN 422


The Extract of header and text block of the IFN 422 message sent by Corporation Bank, Baroda to their Udupi Udupi branch would would appear as follows: follows:

78

Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2K 75

CORP0000456 CORP0000321 IFN 422

Corporation Bank, Ba Baroda Corporation Bank, Udupi Advice of Fate & Request for Instructions

Description Transaction Reference No. Related Reference Amount of Collection Queries

Information IBC/680/2001 OBC/791/2001 D060BEINR1,00,000.00 DRAWEES WANT THE TENOR CHANGED TO 90 INSTEAD OF 60 DAYS FROM DATE OF BILL OF EXCHANGE. PL.ADVISE REVISED INSTRUCTONS.

3.5. Amendment Amendment of Instructions: Instructions: (IFN 430) IFN 430 messages are used us ed to relay amendments to the instructions of a collection item. Example:

Let us assume that in the example quoted in section 3.4 above, the drawers agreed to change tenor of the bill to 90 days days instead of 60 days from the date of the bill of exchange. Corporation Corporation Bank, Udupi would then send an IFN 430 message to Corporation Bank, Baroda advising them of amended instructions. The information to be provided in the message will be as follows: Sender of the Message Receiver of the Message Sender’s Reference No. Receiver’s Reference No. Bill Amount Original Tenor Amended Tenor

: Corporation Bank, Udupi : Corporation Bank, Baroda : OBC/791/2001 : IBC/680/2001 : Rs 1,00,000.00 : 60 days from Date of Bill of Exchange : 90 days from Date of Bill of Exchange

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Message Flow: CORPORATION BANK UDUPI

SK SUPARI CO DOCUMENTS

D O C U M E N T S


PRESENTATION

NON-ACCEPTANCE

IFN 422

IFN 430


The Extract of header and text block of the IFN 430 message sent by Corporation Bank, Baroda to their Udupi branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2K

3 3K

CORP0000321 CORP0000456 IFN 430

Corporation Bank, Udupi Corporation Bank, Baroda Amendment of Instructions

Description Information Transaction Reference No. OBC/791/2001 Related Reference IBC/680/2001 Existing Maturity Date. D060BEINR1,00,000.00 Currency amount Amended Maturity Date. D090BEINR1,00,000.00 Currency amount

3.6. Advice Advice of Payment: Payment: (IFN 400) IFN 400 messages are used to relay advice of payment of a collection item. Let us assume that the bill in in example quoted in section 3.5 above is retired retired by the drawees on 14.01.2002. Corporation Bank, Baroda would then send an IFN 400 message to Corporation Bank, Udupi advising them that the bill has been paid and that they have been credited through the Inter Branch Account for Rs 99,500.00 being proceeds of collection after deducting their commission of Rs 500.00. They would also send an IFN 910 message to the Bank’s Reconciliation System for Rs 99,500.00 and a debit advice to M/s Baroda Supari Suppies. 80

Corporation Bank, Baroda will have to furnish the following details: Sender of the Message Receiver of the Message Sender’s Reference No. Receiver’s Reference No. Bill Amount Tenor Date of Payment Charges Deducted Proceeds Remitted

: Corporation Bank, Baroda : Corporation Bank, Udupi : IBC/680/2001 : OBC/791/2001 : Rs 1,00,000.00 : 90 days from Date of Bill of Exchange : 14.1.2002 : Rs 500.00 : Rs 99,500.00

On receipt of a valid IFN 400 message, Corporation Bank, Udupi would credit the proceeds to M/s SK Supari Co.’s account and send them a credit advice and send an IFN 900 message to the Bank’s Reconciliation System for Rs 99,500.00. Message Flow: S.K. SUPARI CO’S ACCOUNT

FUNDS

DOCUMENTS S.K. SUPARI CO CREDIT ADVICE

CORPORATION BANK UDUPI D O C U M E N T S

IFN 400

IFN 900

CORPORATION BANK RECONCILIATION SYSTEM

DOCUMENTS BARODA SUPARI SUPPLIES

DEBIT ADVICE

BARODA SUPARI SUPPLIES’ ACCOUNT


IFN 910

FUNDS

The Extract of header and text block of the IFN 400 message sent by Corporation Bank, Baroda Baroda to their Udupi branch would appear as follows:

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Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2K 3 3A 7 1B

CORP0000456 CORP0000321 IFN 400

Corporation Bank, Ba Baroda Corporation Bank, Udupi Advice of Payment

Description Transaction Reference No. Related Reference Amount Collected Proceeds Remitted Details of Charges

Information IBC/680/2001 OBC/791/2001 D090BE INR1,00,000.00 14012002INR99,500.00 /COMM/INR500.00

The extract of header and text block of the IFN 910 Message sent by Corporation Bank, Baroda to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

CORP0000456 CORP0000999 IFN 910

Corporation Bank, Ba Baroda Corporation Bank Reconciliation System Credit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Value Date Currency ncy & Amount 5 2A CONTRA PARTY BRANCH

Information IBC/680/2001 NONREF INTER BRANCH ACCOUNT 14012002I 02INR99,500.00 .00 CORP0000321

The extract of header and text block of the IFN 900 Message sent by Corporation Bank, Udupi Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

CORP0000321 CORP0000999 IFN 900

Corporation Bank, Udupi Corporation Bank Reconciliation System Debit Advice

Text Block: Field Description 20 Transaction Reference No. 21 Related Reference 25 Account Identification 32A 32A Value Da Date Currency ncy & Amount 5 2A CONTRA PARTY BRANCH

Information OBC/791/2001 IBC/680/2001 INTER BRANCH ACCOUNT 14012002I 02INR99,500.00 .00 CORP0000456

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4. Let Letter terss of Cred Credit: it: All messages relating to Letters of Credit and Guarantee transactions are grouped under category 7 of IFN. Interpretation of information provided in all category 7 messages relating relating to LCs is subject to ICC Uniform Customs and Practice for Documentary Credits (Latest Revision). Some of the possible uses of SFMS message types in relaying information relating to LC transactions have been discussed below:

4.1. Short LCs (Pre-Advice (Pre-Advices). s). (IFN 705) IFN 705 messages are used for relaying Short LCs. Example:

M/s Super Auto Corporation, 123, Manish Auto Market, 16, Grant Road, Mumbai 400 007 who bank with Syndicate Bank, Mumbai (IFSC say SYND0000011) purchases Automobile spare parts from M/s Uttam Singh Agarwal & Sons, USA House, 206/B, Kashmir Gate, New Delhi. 110024, whose bankers are Syndicate Bank, New Delhi (IFSC say SYND0000022). On 15.10.2001, M/s Super Auto Corporation, request their bankers to issue a short cable transferable LC favoring M/s Uttam Singh Agarwal & Sons. The details of the LC are as follows. Date and Date and Plac Placee of Expi Expiry ry Lates atestt Da Date te for Shi Shipmen pmentt Amount Descrption of of Goods

: 31.1 31.12. 2.20 2001 01,, Ne New w De Delh lhii : 25.1 25.12. 2.20 2001 01 : Rs 2,00,000/: 10 100 No Nos. API Clu Clutch Di Discs scs fo for Pr Premier Pa Padmini 100 Nos. API Clutch Discs for Ambassador Nova 100 Nos. API Clutch Discs for Mahindra MM540 200 Nos. KAP Rear Axle Shafts for Premier Padmini 200 Nos. KAP Rear Axle Shafts for Ambassador Nova

Syndicate Bank, Mumbai issues and the LC (No. ILC/3254/2001) and advises the short LC through its New Delhi branch.

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Message Flow: SUPER AUTO CORPORATION

LC REQUEST

SYNDICATE BANK MUMBAI

IFN 705

UTTAM SINGH AGARWAL & SONS

LC ADVICE

SYNDICATE BANK NEW DELHI

The Extract of header and text block of the IFN 705 message sent by Syndicate Bank, Mumbai to their New Delhi branch would appear as follows: Header Block: Sender Receiver Message Type

SYND0000011 SYND0000022 IFN 705

Syndicate Bank, Mumbai Syndicate Bank, New Delhi Pre-Advice

Text Block: Field 4 0A 20 3 1D 50

Description Form of Documentary Credit Documentary Credit No. Date and Place of Expiry Applicant

59

Beneficiary

3 2B 4 4C

Currency and Amount Latest Date of Shipment

Information IRREVOCABLE TRANFERABLE ILC/3254/2001 31122001NEW DELHI SUPER AUTO CORPORATION 123, MANISH AUTO MARKET, 16, GRANT ROAD, MUMBAI 400 007 UTTAM SINGH AGARAWAL & SONS, USA HOUSE, 206/B,KASHMIR GATE NEW DELHI 110 024 INR2,00,000.00 25122001

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4 5A

Description of Goods

100 NOS. API CLUTCH DISCS FOR PREMIER PADMINI 100 NOS. API CLUTCH DISCS FOR AMBASSADOR NOVA 100 NOS. API CLUTCH DISCS FOR MAHINDRA MM540 200 NOS. REAR AXLE SHAFTS FOR PREMIER PADMINI 200 NOS. REAR AXLE SHAFTS FOR AMBASSADOR NOVA

4.2. LC Issue: Issue: (IFN (IFN 700 & 701) IFN 700 and IFN 701 messages are used to relay LC LC messages. IFN 701 messages are used for continuation of an LC message when the entire LC information cannot be conveyed in a single IFN 700 message. Example:

The beneficiar beneficiaries ies of the LC in the example example quoted quoted in section 4.1 above, M/s M/s Uttam Singh Singh Agarwal & Sons, request the openers to arrange for relaying a detailed LC message. The other details of the LC are as follows: Draft Particulars

: Sight Drafts (in duplicate)for 100% FOB value to be drawn on the Opening Bank Part shipments : Not allowed Transhipment : Not allowed Desc De scrripti iption on of Good Goodss : 100 100 Nos. Nos. AP APII Clut Clutch ch Disc Discss for for Prem Premie ierr Padm Padmiini at Rs 325/325/- per Pc. Pc. 100 Nos. API Clutch Discs for Ambassador Nova at Rs 350/350/- per Pc Pc 100 Nos. API Clutch Discs for Mahindra MM540 at Rs 425/425/- per Pc Pc 200 Nos. KAP Rear Axle Shafts for Premier Padmini at Rs 200/200/- per Pc Pc 200 Nos. KAP Rear Axle Shafts for Ambassador Nova at Rs 250/250/- per Pc Pc Goods Goods to to be dispatc dispatched hed from from : New New Delhi Delhi Good Goodss to be disp dispat atch ched ed to : Mumb Mumbai ai Document Required : Invoices 3 copies Lorry Receipt of any IBA Approved Road Trans port Operator Packing List 3 Copies.

85

Addi Additi tion onal al Cond Condit itio ions ns

: Imm Immed edia iate tely ly aft after er disp dispat atch ch,, a cop copy y of of the the Lor Lorry ry Rece Receip iptt to to be be faxed to the openers. Carbon copies of invoices acceptable but not Xerox copies.

The openers request their bankers to advise full LC particulars to the beneficiaries. On 25.10.2001, Syndicate Bank, Mumbai sends an IFN 700 message and uses an IFN IFN 701 message to relay Desrciption of Goods. Message Flow: SUPER AUTO CORPORATION

LC REQUEST


IFN 700


LC ADVICE

IFN 701


The Extract of header and text block of the IFN 700 and IFN 701 messages sent by Syndicate Bank, Mumbai to their New Delhi branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 27 4 0A 20 23 3 1C 3 1D 50

SYND0000011 SYND0000022 IFN 700

Syndicate Bank, Mumbai Syndicate Bank, New Delhi Advice of Documentary Credit

Description Sequence of Total Form of Documentary Credit Documentary Credit No. Reference to Pre-Advice Date of Issue Date and Place of Expiry Applicant

Information 1/2 IRREVOCABLE TRANFERABLE ILC/3254/2001 ILC/3254/2001 15102001 31122001NEW DELHI SUPER AUTO CORPORATION 123, MANISH AUTO MARKET, 16, GRANT ROAD, MUMBAI 400 007

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59

Beneficiary

3 2B 4 1D

Currency and Amount Available with .. by ..

4 2C

Drafts at ..

4 2A 4 3P 43T 4 4A 4 4B 4 4C 4 6A

Drawee Part shipments Transhipment DISPATCH FROM .. For Transporation to .. Latest Date of Shipment Documents Required

4 7A

Additional Conditions

7 1B

Charges

49

Confirmation Instructions


SYND0000011 SYND0000022 IFN 701

UTTAM SINGH AGARAWAL & SONS, USA HOUSE, 206/B,KASHMIR GATE NEW DELHI 110 024 INR2,00,000.00 ANYBANK NEGOTIATION SIGHT (IN DUPLICATE) FOR 100 PCT FOB VALUE SYND0000011 PROHIBITED PROHIBITED NEW DELHI MUMBAI 25122001 INVOICES – 3 COPIES LORRY RECEIPT OF ANY IBA APPROVED ROAD TRANSPORT OPER OP ERAT ATOR OR - ORIG ORIGIN INAL AL PACKIN PACKING G LIS LIST T – 3 COPI COPIES ES 1. IMMEDIATELY AFTER DISPATCH COPY OF THE LORRY RECEIPT TO BE FAXED TO THE OPENERS. 2. CARBON COPIES OF INVOICES ACCEPTABLE BUT XEROX COPIES NOT ACCEPTABLE ALL CHARGES FOR BENEFIARIES’ ACCOUNT CONFIRM


87

Text Block: Field 27 20 4 5B

Description Sequence of Total Documentary Credit No. Description of Goods

Information 2/2 ILC/3254/2001 100 NOS. API CLUTCH DISCS FOR PREMIER PADMINI AT RS 325/325/- PER PER PC 100 NOS. API CLUTCH DISCS FOR AMBASSADOR NOVA AT RS 350/350/- PER PC 100 NOS. API CLUTCH DISCS FOR MAHINDRA MM540 AT RS 425/425/- PER PER PC 200 NOS. REAR AXLE SHAFTS FOR PREMIER PADMINI AT RS 200/200/- PER PER PC 200 NOS. REAR AXLE SHAFTS FOR AMBASSADOR NOVA AT RS 250/250/- PER PC

4.3. 4.3. Acknowl Acknowledg edgeme ement nt of of LC Message: Message: (IFN (IFN 730) 730) IFN 730 message is used to Acknowledge LC messages and other messages related to LCs. Example:

The receivers of the LC message in the example quoted in section 4.1 above, Syndicate Bank New Delhi acknowledge the LC message by sending an IFN 730 message to Syndicate Bank, Mumbai. Message Flow: SUPER AUTO CORPORATION


LC REQUEST

IFN 700


LC ADVICE

IFN 701

IFN 730


88

The Extract of header and text block of the IFN 730 message sent by Syndicate Bank, New Delhi (Quoting their Inward Inward LC Reference No. LCADV/1025/2001) to their Mumbai branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 30

SYND0000022 SYND0000011 IFN 730

Syndicate Bank, New Delhi Syndicate Bank, Mumbai Acknowledgement

Description Sender’sReference Receiver’s Reference Date of the Message being Acknowledged

Information LCADV/1025/2001 ILC/3254/2001 25102001

4.4. Advice Advice of Another Branch’s Branch’s LC: (IFN 710 & 711) IFN 710 and IFN 711 messages are used to advice LC messages of another branch. IFN 711 messages are used for continuation of an LC message when the entire LC information cannot be conveyed in a single IFN 710 message. Example:

The beneficiaries of the LC in the example quoted in section 4.1 above, M/s Uttam Singh Agarwal & Sons, have recently transferred their account to Kashmir Gate Branch of Syndicate Bank. They request the openers to arrange advising the LC through their bankers. On 29.10.2001, Syndicate Bank, Mumbai send an IFN 799 Free format message to their New Delhi Branch to advise the LC through their Kashmi r Gate Branch. The Extract of header and text block of the IFN 799 message sent by Syndicate Bank, Mumbai to their New Delhi branch would appear as follows: Header Block: Sender Receiver Message Type

SYND0000011 SYND0000022 IFN 700


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Text Block: Field 20 79

Description Documentary Credit No. Narrative

Information ILC/3254/2001 THE BENEFICIARIES OF OUR ABOVE REFERRED LC RELAYED TO YOU ON 15.10.2001 HAVE REQUESTED THAT THAT THE THE LC BE BE ADV ADVIISED SED THOUGH OUR KASHMIR GATE BRANCH. PLEASE ARRANGE ACCORDINGLY.

On 30.10.2001, Syndicate Bank, New Delhi sends an IFN 710 and IFN 711 message to relay the LC (Their Reference LCADV/1025/2001) to Syndicate Bank, Kashmir Gate Branch (IFSC Say SYND.

Message Flow: SUPER AUTO CORPORATION


LC REQUEST

IFN 700

IFN 701

IFN 730

IFN 799


IFN 710


LC ADVICE

IFN 711

SYNDICATE BANK KASHMIR GATE

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The Extract of header and text block of the IFN 710 and IFN 711 messages sent by Syndicate Bank, New Delhi to their Kashmir Gate branch w ould appear as follows: Header Block: Sender Receiver Message Type

SYND0000022 SYND0000420 IFN 710

Syndicate Bank, New Delhi Syndicate Bank, Kashmir Gate Advice of Third Bank’s Documentary Credit

Text Block: Field 27 4 0A 21 20 23 3 1C 3 1D 5 2A 50

Description Sequence of Total Form of Documentary Credit Sender’s Reference Documentary Credit No. Reference to Pre-Advice Date of Issue Date and Place of Expiry Issuing Bank Applicant

59

Beneficiary

3 2B 4 1D


4 2C

Drafts at ..

4 2A 4 3P 43T 4 4A 4 4B 4 4C 4 6A

Drawee Part shipments Transhipment DISPATCH FROM .. For Transporation to .. Latest Date of S Sh hipment Documents Required

4 7A


Information 1/2 IRREVOCABLE TRANFERABLE LCADV/1025/2001 ILC/3254/2001 ILC/3254/2001 15102001 31122001NEW DELHI SYND0000011 SUPER AUTO CORPORATION 123, MANISH AUTO MARKET, 16, GRANT ROAD, MUMBAI 400 007 UTTAM SINGH AGARAWAL & SONS, USA HOUSE, 206/B, KASHMIR GATE NEW DELHI 110 024 INR2,00,000.00 ANYBANK NEGOTIATION SIGHT (IN DUPLICATE) FOR 100 PCT FOB VALUE SYND0000011 PROHIBITED PROHIBITED NEW DELHI MUMBAI 25122001 INVOICES – 3 COPIES LORRY RECEIPT OF ANY IBA APPROVED ROAD TRANSPORT OPER OP ERAT ATOR OR - ORIG ORIGIN INAL AL PACKIN PACKING G LIS LIST T – 3 COPI COPIES ES 1. IMMEDIATELY AFTER DISPATCH COPY OF THE LORRY RECEIPT TO BE FAXED

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7 1B

Charges

49


TO THE OPENERS. 2. CARBON COPIES OF INVOICES ACCEPTABLE BUT XEROX COPIES NOT ACCEPTABLE ALL CHARGES FOR BENEFIARIES’ ACCOUNT CONFIRM

N.B: The message is very similar to an IFN IFN 700 message. The only 2 additional fields in the IFN 710 message are Fields are 21 and 52A. Header Block: Sender Receiver Message Type Text Block: Field 27 20 4 5B

SYND0000022 SYND0000420 IFN 711

Syndicate Bank, New Delhi Syndicate Bank, Kashmir Gate Advice of Third Bank’s Documentary Credit



4.5. Transfer Transfer of LC: (IFN (IFN 720 & 721) IFN 720 and IFN 721 messages are used to advice LC particulars particulars to a beneficiary in whose name the LC has been transferred. IFN 721 messages are used for continuation of an LC message when the entire LC information cannot be conve yed in a single IFN 720 message. messa ge.

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Example:

On 5.11.2001, the beneficiaries of the LC in the example quoted in section 4.1 above, M/s Uttam Singh Agarwal & Sons, request the advising bank to transfer the LC LC in favour of M/s Satnam Singh Arora & Sons, 25/12, G.T.Road, Goraya who bank with Syndicate Bank, Goraya(IFSC say SYND0000579). On the same day, Syndicate Bank, Kashmir Gate sends an IFN 720 and IFN 721 message to their Goraya Branch, transferring the LC in favour od M/s Satnam Singh Arora & Sons. Message Flow: SUPER AUTO CORPORATION


LC REQUEST

IFN 700

IFN 701

IFN 730

IFN 799


IFN 710


LC ADVICE

TRANSFER REQUEST

SYNDICATE BANK KASHMIR GATE

IFN 720

SATNAM SINGH ARORA & SONS

LC ADVICE

IFN 711

IFN 721

SYNDICATE BANK GORAYA

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The Extract of header and text block of the IFN 720 and IFN 721 messages sent by Syndicate Bank, Kashmir Gate branch (Their Ref. LCADV/679/2001) to their Goraya branch would appear as follows: Header Block: Sender Receiver Message Type

SYND0000420 SYND0000579 IFN 720

Syndicate Bank, Kashmir Gate Syndicate Bank, Goraya Transfer of Documentary Credit

Text Block: Field 27 4 0A 21 20 3 1C 3 1D 5 2A 50

Description Sequence of Total Form of Documentary Credit Sender’s Reference Documentary Credit No. Date of Issue Date and Place of Expiry Issuing Bank First Beneficiary

59

Second Beneficiary

3 2B 4 1D


4 2C

Drafts at ..

4 2A 4 3P 43T 4 4A 4 4B 4 4C 4 6A

Drawee Part shipments Transhipment DISPATCH FROM .. For Transporation to .. Latest Date of Shipment Documents Required

4 7A


Information 1/2 IRREVOCABLE TRANFERABLE LCADV/679/2001 ILC/3254/2001 15102001 31122001NEW DELHI SYND0000011 UTTAM SINGH AGARAWAL & SONS, USA HOUSE, 206/B,KASHMI 206/B,KASHMIR R GATE NEW DELHI 110 024 SATNAM SINGH AR ARORA & SONS, 25/12, G.T.ROAD, GORAYA. INR2,00,000.00 ANYBANK NEGOTIATION SIGHT (IN DUPLICATE) FOR 100 PCT FOB VALUE SYND0000011 PROHIBITED PROHIBITED NEW DELHI MUMBAI 25122001 INVOICES – 3 COPIES LORRY RECEIPT OF ANY IBA APPROVED ROAD TRANSPORT OPER OP ERAT ATOR OR - ORIG ORIGIN INAL AL PACKIN PACKING G LIS LIST T – 3 COPI COPIES ES 1. IMMEDIATELY AFTER DISPATCH COPY OF THE LORRY RECEIPT TO BE FAXED TO THE OPENERS. 2. CARBON COPIES OF

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7 1B

Charges

49


INVOICES ACCEPTABLE BUT XEROX COPIES NOT ACCEPTABLE ALL CHARGES FOR BENEFIARIES’ ACCOUNT CONFIRM

N.B: The message is very similar to an IFN 700 message. The only 2 additional fields in the IFN 720 message message are Fields Fields are 21 and 52A. 52A. And in the Field Field 50, the name of the original beneficiary is shown instead of the openers and in Field 59, the name of the transferee is shown instead of the transferor. If the LC were to be transferred again, Field 50 would contain the present transferee (viz., Satnam Singh Arora & Sons) will be shown and the new transferees name will appear in Field 59. Header Block: Sender Receiver Message Type Text Block: Field 27 20 4 5B

SYND0000022 SYND0000420 IFN 721

Syndicate Bank, New Delhi Syndicate Bank, Kashmir Gate Transfer of Documentary Credit



95

4.6. Advice Advice of LC Amendment: Amendment: (IFN 707) IFN 707 messages are used to advice amendments to to LC messages. Example:

On 15.11.2001, the beneficiaries of the LC in the example quoted in section 4.1 above, M/s Uttam Singh Agarwal & Sons, request the openers to amend the LC and extend the Last date for shipment shipment to 31.12.2001 31.12.2001 and date of expiry expiry of LC to 7.1.2002 7.1.2002 and advise it to the the second beneficiaries viz., Satnam Singh Arora & Sons through Syndicate Bank, Goraya. On openers’ request, Syndicate Bank, Mumbai amends the LC accordingly and sends an IFN 707 message to their Goraya Branch. Message Flow:

SUPER AUTO CORPORATION

AMENDMENT REQUEST


IFN 707


AMENDMENT ADVICE


The Extract of header and text block of the IFN 707 sent by Syndicate Bank, Mumbai (Their Ref. LCAMD/786/2001) to their Goraya branch would appear as follows: Header Block: Sender Receiver Message Type

SYND0000011 SYND0000579 IFN 707

Syndicate Bank, Mu Mumbai Syndicate Bank, Goraya Amendment of a Documentary Credit

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Description Sender’s Reference Receiver’s Reference Second Beneficiary

31E 4 4C

New Date of Expiry Latest Date of Shipment

(1) (1)

Information LCAMD/786/2001 NONREF (1) SATNAM SINGH AR ARORA SONS, 25/12, G.T.ROAD, GORAYA. 31122001 07012002

&

As the the IFN IFN 720 720 and and IFN IFN 721 721 messa message gess woul would d have have been been sent sent by Syndi Syndicat catee Ban Bank, k, Kashmir Gate to Syndicate Bank, Goraya, Goraya, the latter would would not have sent an IFN 730 message to Syndicate Bank, Mumbai. As such, Syndicate Bank, Mumbai would have to use NONREF in Field 21.

4.7. Advice of Payment/Acceptance/Negotiation: (IFN 754) IFN 754 message is used to relay advice of Payment/Acceptance/Negotiation of bills covered by an LC. The message is usually sent by the paying/accepting/negotiating bank to the issuing bank Whether an IFN 754 message conveys advice of Payment, Acceptance or Negotiation depends on the nature of the LC. 

 

If the LC is available by Payment, Deferred Payment or Mixed Payment, then IFN 754 message conveys advice of payment. If the LC is available by Acceptance, then IFN 754 message conveys advice of acceptance. If the LC is available by Negotiation, then IFN 754 message conveys advice of negotiation.

Example:

On 5.01.2002, the beneficiaries (Transferees) of the LC in the example quoted in section 4.5 above, M/s Satnam Singh Arora & Sons, 25/12, G.T.Road, Goraya submit a bill (their Ref. OB/2468) for Rs 2,00,000/- under the LC for negotiation to Syndicate Bank, Goraya. Syndicate Bank, Goraya negotiate the bill and send an IFN 754 advice of negotiation message to their Mumbai branch.

97

Message Flow:



IFN 754


DOCUMENTS

FUNDS


The Extract of header and text block of the IFN 754 sent by Syndicate Bank, Goraya (Their Ref. LCBP/135/2001) to their Mumbai branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2A

SYND0000579 SYND0000011 IFN 754

Syndicate Bank, Goraya Syndicate Bank, Mumbai Advice of Negotiation

Description Information Sender’s Reference LCBP/135/2001 Receiver’s Reference ILC/3254/2001 Principal Am Amount Ne Negotiated 05012002INR2,00,000.00

4.8. Advice Advice of Payment: Payment: (IFN 756) IFN 756 message is used to relay advice of Payment of a bill drawn under and LC. IFN IFN 756 message is often confused with IFN 754 as both messages can be used as advices of payment. It is therefore important to note that IFN 754 is sent to the issuing bank by a bank that pays the beneficiary of an LC available by payment whereas IFN 756 messages are sent by the issuing bank to a bank, which has negotiated/accepted/paid a bill under an LC.

98

Example:

In the example quoted in section 4.7 above, Syndicate Bank, Goraya forwards the documents pertaining to the bill negotiated by it to its Mumbai branch who having examined and found the bill to be in order, take up the bill on 11.01.2002 and send an IFN 756 message advising advis ing them of payment of the bill. It also sends an IFN 910 message to the Bank ’s Reconciliation System and a notice to the applicants viz., M/s Super Auto Corporation, to retire the bill. On receipt of a valid and authenticated IFN 756, Syndicate Bank, Goraya passes necessary adjustment adjustment entries entries in its LC Bills Bills Account and and sends an IFN 900 message message to the Bank’s Bank’s Reconciliation System. Message Flow:



D O C U M E N T


DOCUMENTS

FUNDS

IFN 756

IFN 910



IFN 900

The Extract of header and text block of the IFN 756 sent by Syndicate Bank, Mumbai (Their Reference LCBR 9753/2001) to their Goraya Goraya branch would appear appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2B 3 3A

SYND0000011 SYND0000579 IFN 756

Syndicate Bank, Mumbai Syndicate Bank, Goraya Advice of Payment

Description Sender’s Reference Receiver’s Reference Total Amount Claimed Amount Paid

Information LCBR 9753/2001 LCBP/135/2001 INR2,00,000.00 11012002 INR2,00,000.00

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The extract of header and text block of the IFN 910 Message sent by Syndicate Bank, Mumbai to the Reconciliation System (IFSC say SYND0009999) would be as follows: Header Block: Sender Receiver Message Type

SYND0000011 SYND0009999 IFN 910

Syndicate Bank, Mumbai Syndicate Bank, Reconciliation System Credit Advice


Information LCBR 9753/2001 LCBP/135/2001 INTER BRANCH ACCOUNT 1101 110120 2002 02 INR2, NR2,00 00,0 ,000 00.0 .00 0 SYND0000579

The extract of header and text block of the IFN 900 Message sent by Syndicate Bank, Goraya Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

SYND0000579 SYND0009999 IFN 900

Syndicate Bank, Goraya Syndicate Bank, Reconciliation System DebitAdvice


4.9. 4.9.

Information LCBP/135/2001 LCBR 9753/2001 INTER BRANCH ACCOUNT 1101 110120 2002 02 INR2, NR2,00 00,0 ,000 00.0 .00 0 SYND0000011

Advi Advice ce of of Disc Discre repa panc ncy: y: (IF (IFN N 750) 750)

IFN 750 messages are used to advice discrepancies in documents submitted for negotiation/ payment/acceptance under an LC. The message is sent by the negotiating/paying/accepting bank to the issuing bank requesting for auth orization to negotiate/pay/accept.

100

Example:

On 5.01.2002, the beneficiaries (Transferees) of the LC in the example quoted in section 7.5 above, M/s Satnam Singh Arora & Sons, 25/12, G.T.Road, Goraya submit a bill (their Ref. OB/2468) for Rs 2,00,000/- under the LC for negotiation to Syndicate Bank, Goraya. On scrutinizing the documents, Syndicate Bank, Goraya find that the goods were dispatched on 2.1.2002, viz., after the latest date of shipment, which is, 31.12.2001 after the amendment mentioned in section vi. above. They therefore send an IFN 750 advice of discrepancy message to their Mumbai branch on 5.01.2002, requesting permission permission to negotiate. Message Flow:



IFN 750


DOCUMENTS

FUNDS


The Extract of header and text block of the IFN 750 sent by Syndicate Bank, Goraya to their Mumbai branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2B 7 7J

SYND0000579 SYND0000011 IFN 750

Syndicate Bank, Goraya Syndicate Bank, Mumbai Advice of Discrepancy

Description Information Sender’s Reference LCBP/135/2001 Receiver’s Reference ILC/3254/2001 Principal Am Amount Ne Negotiated INR2,00,000.00 Discrepancies SHIPMENT EFFECTED ON 2.1.2002

101

4.10. Authorisati Authorisation on to Pay, Accept or Negotiate: Negotiate: (IFN 752) IFN 752 message is used to convey authorisat authorisation ion to negotiate/pay negotiate/pay/accep /acceptt documents documents with discrepancies submitted under an LC. It is normally sent by the issuing bank in response to an IFN 750 advice of discrepancy message. Example:

If the discrepanc discrepancies ies mentioned mentioned in the IFN 750 message discussed discussed in the example example quoted quoted in section 4.9 above, are acceptable to the applicants of the LC, Syndicate Bank, Mumbai would send an IFN 752 message to their Goraya branch authorising them to negotiate the discrepant documents. Message Flow: SUPER AUTO CORPORATION

ADVICE OF DISCREPANCY


INSTRUCTION

IFN 750


DOCUMENTS

FUNDS

IFN 752


The Extract of header and text block of the IFN 752 sent by Syndicate Bank, Mumbai to their Goraya branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 23 30

SYND0000011 SYND0000579 IFN 754

Syndicate Bank, Mumbai Syndicate Bank, Goraya Advice of Negotiation

Description LC Number Presenting Bank’s Reference Further Identification Date of advice of Discrepancy

Information ILC/3254/2001 LCBP/135/2001 NEGOTIATE 05012002

102

4.11. Advice Advice of Discharge: Discharge: (IFN (IFN 732) IFN 732 messages are normally sent by the issuing bank to advise the negotiating bank that the documents negotiated with discrepant documents have been taken up. In such cases, the negotiating bank would have proceeded with negotiation of the bill with discrepant documents without referring discrepancies to the issuing bank through an IFN 750 message. Instead, the discrepancy would be mentioned in the IFN 754 advice of Negotiation and the issuing bank would be requested to take up the documents. Example:

Let us assume that in the example quoted in section 4.9 above, Syndicate Bank, Goraya branch proceeds to negotiate the bill on 5.1.2002 in spite of the discrepancies in the supporting documents and sends an IFN 754 advice of negotiation on the same day, requesting their Mumbai branch to take up the documents and forwards the documents to Syndicate Bank, Mumbai. The discrepancies are acceptable to the applicants of the LC. Syndicate Bank, Mumbai ON 11.01.2002, 11.01.2002, send an IFN IFN 732 message to their their Goraya Goraya branch advising advising them them that the documents have been taken up in spite of the discrepancies. They also send an IFN 910 message to the Bank’s Reconciliation System. On receipt of a valid and authenticated IFN 732 message, Syndicate Bank, Goraya passes necessary adjustment entries in its LC Bills Account and sends an IFN 900 message to the Bank’s Reconciliation System. Message Flow:

ADVICE OF DISCREPANCY SUPER AUTO CORPORATION


ACCEPTANCE

IFN 754


DOCUMENTS

FUNDS

D O C U M E N T


IFN 910

IFN 732


IFN 900

103

The Extract of header and text block of the IFN 754 sent by Syndicate Bank, Goraya to their Mumbai branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2A 72

SYND0000579 SYND0000011 IFN 754


Description Information Sender’s Reference LCBP/135/2001 Receiver’s Reference ILC/3254/2001 Principal Am Amount Ne Negotiated 05012002INR2,00,000.00 Sender to Receiver WE HAVE NEGOTIATED IN Information SPITE OF THE FOLLOWING DISCREPANCY: LAST DATE FOR SHIPMEN SHIPMENT T EXCEEDE EXCEEDED D BY 2 DAYS. KINDLY ADVISE DISCHARGE ASAP.

The Extract of header and text block of the IFN 732 sent by Syndicate Bank, Mumbai to their Goraya branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 30

3 2B 72

SYND0000011 SYND0000579 IFN 732

Syndicate Bank, Mumbai Syndicate Bank, Goraya Advice of Discharge

Description LC Number Presenting Bank’s Reference Date of Advice of Payment/ Acceptance/Negotiation Amount of Utilisation Sender to Receiver Information

Information ILC/3254/2001 LCBP/135/2001 05012002

INR2,00,000.00 WE HAVE TODAY CREDITED YOU THRU INTER BRANCH ACCOUNT FOR RS 2,00,000/-

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The extract of header and text block of the IFN 910 Message sent by Syndicate Bank, Mumbai to the Reconciliation System (IFSC say SYND0009999) would be as follows: Header Block: Sender Receiver Message Type

SYND0000011 SYND0009999 IFN 910

Syndicate Bank, Mumbai Syndicate Bank, Reconciliation System Credit Advice


Information LCBR 9753/2001 LCBP/135/2001 INTER BRANCH ACCOUNT 1101 110120 2002 02 INR2, NR2,00 00,0 ,000 00.0 .00 0 SYND0000579

The extract of header and text block of the IFN 900 Message sent by Syndicate Bank, Goraya Branch to the Reconciliation System would be as follows: Header Block: Sender Receiver Message Type

SYND0000579 SYND0009999 IFN 900

Syndicate Bank, Goraya Syndicate Bank, Reconciliation System Debit Advice


Information LCBP/135/2001 LCBR 9753/2001 INTER BRANCH ACCOUNT 1101 110120 2002 02 INR2, NR2,00 00,0 ,000 00.0 .00 0 SYND0000011

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4.12. Advice Advice of Refusal: Refusal: (IFN (IFN 734) IFN 734 messages are normally sent by the issuing bank to advise the paying/negotiating bank that the documents documents paid/negot paid/negotiated iated with with discrepancies discrepancies in the documents documents forwarded forwarded are not acceptable and that the documents are either being held at the negotiating bank’s risk or is being returned to them. In such cases, the paying/negotiating bank would have proceeded with payment/negotiation of the bill with discrepant documents with out referring discrepancies disc repancies to the issuing bank through an IFN 750 message. Instead, the discrepancy would be mentioned in the IFN 754 advice of Payment/Negotiation/Acceptance and the issuing bank would be requested to take up the documents. Example:

Let us assume that in the example quoted in section 4.9 above, Syndicate Bank, Goraya branch proceeds to negotiate the bill on 5.1.2002 in spite of the discrepancies in the supporting documents and sends an IFN 754 advice of negotiation on the same day, requesting their Mumbai branch to take up the documents and forwards the documents to Syndicate Bank, Mumbai. The discrepancies are not acceptable to the applicants of the LC. Syndicate Bank, Mumbai on 11.01.2002, sends an IFN 734 message to their Goraya branch advising them that the discrepancies are not acceptable and that documents are being held at their risk and disposal. Message Flow:

ADVICE OF DISCREPANCY SUPER AUTO CORPORATION


REFUSAL

IFN 754


DOCUMENTS

FUNDS

D O C U M E N T


IFN 910

IFN 734


IFN 900

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The Extract of header and text block of the IFN 754 sent by Syndicate Bank, Goraya (to their Mumbai branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2A 72

SYND0000579 SYND0000011 IFN 754


Description Information Sender’s Reference LCBP/135/2001 Receiver’s Reference ILC/3254/2001 Principal Am Amount Ne Negotiated 05012002INR2,00,000.00 Sender to Receiver WE HAVE NEGOTIATED IN Information SPITE OF THE FOLLOWING DISCREPANCY: LAST DATE FOR SHIPMENT EXCEEDED BY 2 DAYS. KINDLY DISCHARGE US ASAP.

The Extract of header and text block of the IFN 734 sent by Syndicate Bank, Mumbai to their Goraya branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 3 2A

SYND0000011 SYND0000579 IFN 734

Syndicate Bank, Mumbai Syndicate Bank, Goraya Advice of Refusal

7 7J

Description LC Number Presenting Bank’s Reference Date and Amount of Utilisation Discrepancies

7 7B

Disposal of Documents

Information LCBR 9753/2001 LCBP/135/2001 05012002 INR2,00,000.00

LAST DATE FOR SHIPMENT EXCEEDED BY 2 DAYS. DOCUMENTS HE HELD AT AT YOUR RISK. ADVISE DISPOSAL ASAP

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5. Gu Guara arant ntees ees:: SFMS provides message types for Issuing or Requesting for issuing of a guarantee, acknowledgement of a guarantee message, amendments to a guarantee and advice of reduction or release.

5.1. Issue of Guarantee: Guarantee: IFN 760 messages are used to relay guarantees. Example:

On 10.11.2001, M/s National Power Systems request State Bank of Mysore, Hosur (IFSC Say SBMY0000765) SBMY0000765) to to issue a Bank Guarantee Guarantee for Rs 1,00,000/1,00,000/- favouring favouring State State Bank of Mysore, Mysore, Nagpur Branch (IFSC Say SBMY0000345). The details of the guarantee are as follows: M/s National Power Systems have agreed to supply and install 2 X 25.0 KVA UPS Systems with Battery at State Bank of Mysore, Nagpur branch Premises in terms of their Order No. SBM/0102/1305 Dated 06.10.2001. As per the order terms, M/s National Power Systems have to arrange for issue of a Bank Guarantee for Rs 1,00,000/-, valid up to 10.02.2002, indemnifying them (viz., State Bank of Mysore, Nagpur) from any loss or damage caused by M/s National Power Systems’ inability to execute the order as per order terms. After obtaining a counter guarantee from M/s National Power Systems, State Bank of Mysore, Hosur send an IFN 760 message to SBM Nagpur, (Their Ref. BG/310/2001) undertaking undertaking to pay the receiver of the message up to Rs 1 lakh in in case of breach of purchase purchase order terms by M/s National Power Systems. Message Flow: NATIONAL POWER SYSTEMS

REQUEST TO ISSUE GUARANTEE

STATE BANK OF MYSORE HOSUR

COUNTER GUARANTEE

IFN 760

STATE BANK OF MYSORE NAGPUR

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The Extract Extract of header and text block of the the IFN 760 message sent by State State Bank of Mysore, Mysore, Hosur to their Nagpur branch would appear as follows: Header Block: Sender Receiver Message Type

SBMY0000765 SBMY0000345 IFN 760

State Bank of Mysore, Hosur State Bank of Mysore, Nagpur Guarantee

Text Block: Field Description Information 27 Sequence of Total 1/1 20 Transaction Ref. Number BG/310/2001 23 Further Identification ISSUE (1) 30 Date (OF ISSUE) 10112001 7 7C Details of Guarantee (2) AMOUNT OF GUARANTEE RS. 98,800/GUARNTEE COVER FROM 24.08.2001 TO 22.07.2002 . (3) THIS DEED OF GUARANTEE EXECUTED BY THE STATE BANK OF MYSORE, AN ASSOCIATE OF STATE BANK OF INDIA, UNDER THE STATE BANK OF INDIA SUBSIDIARY ACT 1959, HAVING ITS HEAD OFFICE AT KEMPEGOWD KEMPEGOWDA A ROAD, ROAD, BANGALORE BANGALORE – 560 009 AND AND AMONGST OTHER PLACES, A BRANCH AT HOSUR, TAMILNADU (HEREINAFTER REFERRED TO AS BANK) IN FAVOUR OF STATE BANK OF MYSORE, NAGPUR (HEREINAFTER REFERRED TO AS BENEFICIARIES ) FOR AN AMOUNT NOT EXCEEDING RS.1,00,000/(RUPEES ONE LAKH ONLY) AT THE REQUEST OF M/S NATIONAL POWER SYSTEMS BANGALORE ROAD, HOSUR (HEREINAFTER REFERRED TO AS VENDOR) . IN CONSIDERATION OF BENEFICIARIES HAVING AGREED TO ACCEPT THIS BANK BANK GUARANTEE GUARANTEE OF RS.1,00,000/RS.1,00,000/- (RUPEES (RUPEES ONE LAKHONLY) LAKHONLY) REQUIRED FROM VENDOR TOWARDS SATISFACTORY PERFORMANCE FOR THE SUPPLY OF 1 SET OF 2 X 25.0 KVA UPS SYSTEMS WITH BATTERY INSTALLED AT BENEFICIARIES PREMISES, PREMISES, ACCORDIING TO THE TERMS AND CONDITIONS OF THE PURCHASE ORDER NO. SBM/01-02/1305 DATED 26.10.2001, THE BANK DOES HEREBY UNDERTAKE TO PAY BENEFICIARIES, AN AMOUNT NOT EXCEEDING RS.1, RS.1,00 00,00 ,000/0/- (RUP (RUPEE EES S ONE ONE LAKH LAKHON ONLY LY)) AGAI AGAINS NST T AN ANY Y LOSS LOSS OF DAMAGE CAUSED TO OR SUFFERED OR WOULD BE CAUSED TO OR SUFFERED BY BENEFICIARIES BY REASON OF ANY BREACH BY THE SAID VENDOR OF ANY OF THE TERMS AND CONDITIONS OF THE SAID PURCHASE ORDER.

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WE, STATE BANK OF MYSORE, HOSUR, DO HEREBY UNDERTAKE TO PAY THE AMOUNTS DUE AND PAYABLE UNDER THIS GURANTEE WITHOUT ANY DEMUR ON A DEMAND FROM BENEFICIARIES STATING THAT THE AMOUNT CLAIMED IS DUE BY WAY OF LOSS OR DAMAGE CAUSED TO OR SUFFERED BY BENEFICIARIES BY REASON OR ANY BREACH BREACH BY THE VENDOR OF ANY OF THE TERMS AND AND CONDITIONS OF THE SAID PURCHASE ORDER . ANY SUCH DEMAND MADE ON THE BANK SHALL BE CONCLUSIVE AS REGARDS THE AMOUNT DUE AND PAYABLE BY THE BANK UNDER THIS GURANTEE . NOT WITHSTANDING ANYTHING CONTAINED HEREIN: HEREIN: . A. OUR LIABILITY UNDER THIS BANK GUARANTEE SHALL NOT BE EXCEED EXCEEDI EXCEEDING NG RS.1,00,000/RS.1,00,000/- (RUPEES (RUPEES ONE LAKHONLY LAKHONLY)) B. THIS BANK GUARANTEE SHALL BE VALID UPTO 10.02.2002 AND THEREAFTER CEASES TO BE IN EFFECT IN ALL RESPECTS, WHETHER OR NOT THE ORIGINAL BANK GUARANTEE IS RETURNED TO US AND C. WE ARE LIABLE LIABLE TO PAY THE GUARANT GUARANTEED EED AMOUNT AMOUNT OR ANY ANY PART THEREOF UNDER THIS BANK GUARANTEE ONLY IF YOU SERVE UPON US A WRITTEN CLAIM OR DEMAND ON OR BEFORE 1 0.02.2002 (1)

The words words “ISSUE” “ISSUE” in in field field 23 indicate indicate that that the the sender sender of the message message is is issuing issuing the the guarantee and that the receiver of the message is the party being indemnified. If the words “REQUEST” appears in field 23, then it indicates that the receiver of the message is being requested to issue a guarantee on behalf of the sender of the message. (2) The column column for for field field 77C 77C has been widened widened to carry carry the rather rather lengthy lengthy guarante guaranteee message. (3) In SFMS, SFMS, blank blank lines lines are are not allowe allowed. d. It It is theref therefore ore necessary necessary to use a “.”to indicate indicate blank lines.

5.2. 5.2. Requ Reques estt to issu issuee a Gua Guara rant ntee: ee: IFN 760 messages are also used to relay requests sent by one branch to another requesting the receiver to issue a guarantee on behalf of the sender of the message. messa ge. Example:

In the example given in section 5.1 above, let us assume that the beneficiary is not State Bank of Mysore, Nagpur but a Nagpur based company say SSR Ltd. State Bank of Mysore, Hosur would then send an IFN 960 message to its Nagpur branch, requesting the latter to issue the guarantee on its behalf.

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Message Flow:

NATIONAL POWER SYSTEMS

REQUEST TO ISSUE GUARANTEE

COUNTER GUARANTEE


IFN 760

SSR LTD

GUARANTEE


The Extract of header and text block of the IFN 760 message sent by State Bank of Mysore, Hosur to their Nagpur branch would appear as follows: Header Block: Sender Receiver Message Type

SBMY0000765 SBMY0000345 IFN 760

State Bank of Mysore,Hosur State Bank of Mysore, Nagpur Guarantee

Text Block: Field Description Information 27 Sequence of Total 1/1 20 Transaction Ref. Number BG/310/2001 23 Further Identification REQUEST (1) 30 Date (FOR ISSUE) 10112001 (2) 7 7C Details of Guarantee AMOUNT OF GUARANTEE RS. 98,800/GUARNTEE COVER FROM 24.08.2001 TO 22.07.2002 . THIS DEED OF GUARANTEE EXECUTED BY THE STATE BANK OF MYSORE, AN ASSOCIATE OF STATE BANK OF INDIA, UNDER THE STATE BANK OF INDIA SUBSIDIARY ACT 1959, HAVING ITS HEAD OFFI OF FICE CE AT KEMP KEMPEG EGOW OWDA DA ROAD ROAD,, BAN BANGAL GALOR ORE E – 560 560 009 009 AN AND D AMONGST OTHER PLACES, A BRANCH AT NAGPUR (HEREINAFTER REFERRED TO AS BANK) IN FAVOUR OF M/S SSR LTD., NAGPUR (HEREINAFTER REFERRED TO AS BENEFICIARIES ) FOR AN AMOUNT NOT EXCEEDING RS.1,00,000/- (RUPEES ONE LAKH ONLY) AT THE

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REQUEST OF M/S NATIONAL POWER SYSTEMS BANGALORE ROAD, HOSUR (HEREINAFTER REFERRED TO AS VENDOR) . IN CONSIDERATION OF BENEFICIARIES HAVING AGREED TO ACCEPT THIS BANK BANK GUARANTEE GUARANTEE OF RS.1,00,000/RS.1,00,000/- (RUPEES (RUPEES ONE LAKHONLY) LAKHONLY) REQUIRED FROM VENDOR TOWARDS SATISFACTORY PERFORMANCE FOR THE SUPPLY OF 1 SET OF 2 X 25.0 KVA UPS SYSTEMS WITH BATTERY INSTALLED AT BENEFICIARIES PREMISES, ACCORDIING TO THE TERMS AND CONDITIONS OF THE PURCHASE ORDER NO. SBM/01-02/1305 DATED 26.10.2001, THE BANK DOES HEREBY UNDERTAKE TO PAY BENEFICIARIES, AN AMOUNT NOT EXCEEDING RS.1,00,000/RS.1,00,000/- (RUPEES (RUPEES ONE LAKH ONLY) AGAINST AGAINST ANY LOSS OF OF DAMAGE CAUSED TO OR SUFFERED OR WOULD BE CAUSED TO OR SUFFERED BY BENEFICIARIES BY REASON OF ANY BREACH BY THE SAID VENDOR OF ANY OF THE TERMS AND CONDITIONS OF THE SAID PURCHASE ORDER . WE, STATE BANK OF MYSORE, NAGPUR, DO HEREBY UNDERTAKE TO PAY THE AMOUNTS DUE AND PAYABLE UNDER THIS GURANTEE WITHOUT ANY DEMUR ON A DEMAND FROM BENEFICIARIES STATING THAT THE AMOUNT CLAIMED IS DUE BY WAY OF LOSS OR DAMAGE CAUSED TO OR SUFFERED BY BENEFICIARIES BY REASON OR ANY BREACH BY THE VENDOR OF ANY OF THE TERMS AND CONDITIONS OF THE SAID PURCHASE ORDER . ANY SUCH DEMAND MADE ON THE BANK SHALL BE CONCLUSIVE AS REGARDS THE AMOUNT DUE AND PAYABLE BY THE BANK UNDER THIS GURANTEE . NOT WITHSTANDING ANYTHING CONTAINED HEREIN: HEREIN: . A. OUR LIABILITY UNDER THIS BANK GUARANTEE SHALL NOT BE EXCEED EXCEEDI EXCEEDING NG RS.1,00,000/RS.1,00,000/- (RUPEES (RUPEES ONE LAKH LAKH ONLY) B. THIS BANK GUARANTEE SHALL BE VALID UPTO 10.02.2002 AND THEREAFTER CEASES TO BE IN EFFECT IN ALL RESPECTS, WHETHER OR NOT THE ORIGINAL BANK GUARANTEE IS RETURNED TO US AND C. WE ARE LIABLE TO PAY THE GUARANTEED AMOUNT OR ANY PART THEREOF UNDER THIS BANK GUARANTEE ONLY IF YOU SERVE UPON US A WRITTEN CLAIM OR DEMAND ON OR BEFORE 1 0.02.2002 (1) The words “REQUEST” in in field 23, indicates indicates that the receiver of the the message is being requested to issue a guarantee on behalf of the sender of the message (2) The date date on which the the receiver receiver should should issue the the guarantee. guarantee. (3) The guarantee has been worded worded as it would appear appear if the receiver were to issue the the guarantee. It can also be worded as if sender was issuing the guarantee. The receiver would effect the necessary changes.

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5.3. Acknowledgem Acknowledgement ent of Guarantee Guarantee Message: IFN 760 messages are used to relay amendments to a guarantee. Example:

In the example example given in section section 5.2 above, above, Stata Bank Bank of Mysore would would send an IFN 768 message to acknowledge the guarantee message. Message Flow: REQUEST TO ISSUE GUARANTEE


COUNTER GUARANTEE


IFN 767

GUARANTEE

SSR LTD

IFN 768


The Extract of header and text block of the IFN 768 message sent by State Bank of Mysore, Nagpur to their Hosur branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 20 21 30

SBMY0000345 SBMY0000765 IFN 768

State Bank of Mysore, Nagpur State Bank of Mysore, Hosur Guarantee Acknowledgement

Description Transaction Ref. Number Related Reference Date of messsage being acknowledged

Information BG/102/2001 BG/310/2001 10112001

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5.4. Guarantee Guarantee Amendment: Amendment: IFN 760 messages are used to relay amendments to a guarantee. Example:

In the example given in section 5.2 above, let us assume that on 31.1.2002, M/s National Power Systems, request State Bank of Mysore, Hosur to extend the validity period of the guarantee up to 31.3.2001. State Bank of Mysore, Hosur would then send an IFN 767 message to its Nagpur branch, requesting the latter to advise M/s SSR Ltd of the amendment to the guarantee. Message Flow: REQUEST TO AMEND GUARANTEE


AMENDED COUNTER GUARANTEE


IFN 767

GUARANTEE AMENDMENT

SSR LTD


The Extract of header and text block of the IFN 767 message sent by State Bank of Mysore, Hosur to their Nagpur branch would appear as follows: Header Block: Sender Receiver Message Type Text Block: Field 27 20 21 23 30 26E

SBMY0000765 SBMY0000345 IFN 767

State Bank of Mysore,Hosur State Bank of Mysore, Nagpur Guarantee Amendment

Description Sequence of Total Transaction Ref. Number Related Reference Further Identification Date (FOR AMENDMENT) Number of Amendment

Information 1/1 BG/310-AMD1/2001 BG/310/2001 REQUEST 31012001 1

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3 1C Date of Request to Issue 10112001 7 7C Amendment Details THE GUARANTEE HAS BEEN AMENDED AS FOLLOWS. FOL LOWS. . 1. THE VALIDITY PERIOD OF THE GUARANTEE HAS BEEN EXTENDED UP TO 31.3.2002. 2. THE BANK GUARANTEE SHALL BE VALID UPTO 31.03.2002 AND THEREAFTER CEASE TO BE IN EFFECT IN ALL RESPECTS, WHETHER OR NOT THE ORIGINAL BANK GUARANTEE IS RETURNED TO US AND WE ARE LIABLE TO PAY THE GUARANTEED AMOUNT OR ANY PART THEREOF UNDER THIS BANK GUARANTEE ONLY IF YOU SERVE UPON US A WRITTEN CLAIM OR DEMAND ON OR BEFORE 3 1.03.2002 3. ALL OTHER TERMS AND CONDITIONS REMAIN UNCHANGED.

5.5. 5.5. Advi Advice ce of of Redu Reducti ction on or or Rele Releas ase: e: Header Block: Sender Receiver Message Type Text Block: Field 20 21 30 3 3B

SBMY0000345 SBMY0000765 IFN 769

State Bank of Mysore, Nagpur State Bank of Mysore, Hosur Advice of Reduction

Description Transaction Ref. Number Related Reference Date of Reduction/Release Amount Reduced/Released

Information BG/102/2001 BG/310/2001 31012001 1

6. Debit Debit Credit Credit Advice Advices: s: 7. Opinio Opinion n Repor Reports: ts: 7.1. 7.1. Reques Requestt ffor or Op Opini inion on Report Report Header Block: Sender Receiver Message Type

SBMY0000345 SBMY0000765 IFN 985

State Bank of Mysore, Nagpur State Bank of Mysore, Hosur Status Enquiry

Text Block:

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Field 20 59 75

Description Transaction Ref. Number Enquired Party Queries

Information BG/102/2001 31012001 1

7.2. 7.2. Opini pinion on Rep Repor orts ts::


SBMY0000345 SBMY0000765 IFN 986

State Bank of Mysore, Nagpur State Bank of Mysore, Hosur Status Report


Description Transaction Ref. Number Enquired Party Narrative

Information BG/102/2001 31012001 1

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