Introduction of Legal Entity Identifier for large value transactions of INR 50 crores or more in Centralized Payment System
With effect from April 1, 2021, The Reserve Bank of India has decided to introduce the LEI system for all payment transactions of value INR 50 crore and above undertaken by entities (non-individuals) using National Electronic Funds Transfer (NEFT) andReal Time Gross Settlement (RTGS).
- Member banks will include specific fields in NEFT and RTGS payment forms for recording Remitter and Beneficiary LEI details for the transactions undertaken and will also maintain records of all transactions of ₹50 crore and above through RTGS / NEFT.
- The Legal Entity Identifier (LEI) is a 20-digit number which is used to uniquely identify parties to financial transactions worldwide.
- Entities can obtain LEI from any of the Local Operating Units (LOUs) accredited by the Global Legal Entity Identifier Foundation (GLEIF), the body tasked to support the implementation and use of LEI. In India, LEI can be obtained from Legal Entity Identifier India Ltd. (LEIL).
Source- RBI/2020-21/82 DPSS.CO.OD No.901/06.24.001/2020-21
-Umang Dhiman, Audit Associate, SW India