Description
What is CMS?
* CMS is the process of optimizing receivable and payables ensuring predictability in the cash flows of CMS clients
* In a geographically large country like India having a complex financial clearing system, corporate find it increasingly challenging to process collections & payments across dispersed business locations.
Presented By
Adnan Abdul Kader
Piyush Das
Zeeshan Mohammad
? What is CMS
? Need for CMS
? Customer Benefits
? CMS Structure
? Client Acquisition Process
? CMS Procedure
? CMS Collection Products
? Express Local Collection
? Swift Workflow
? Max Reach Workflow
? Branch Responsibility
? Operational Constraint
? Disbursement
? Host to Host Connectivity
? Correspondent Bank
Services
? CMS is the process of optimizing receivable and payables ensuring predictability
in the cash flows of CMS clients.
? In a geographically large country like India having a complex financial clearing
system, corporate find it increasingly challenging to process collections &
payments across dispersed business locations.
? Cash Management thus means getting funds in time, quick transfers, quick
realization of local and outstation instruments, easy disbursements, accounts
reconciliation, controlled processes and customized MIS.
? Geographical spread of the country
? Complex clearing system
? Delays in cash realizations
? Uncertainty in cash flows
? Increased borrowing and associated costs
? Difficulty in collecting data / MIS on the funds
collected
? Assured Credit
• Availability of cleared funds variable
• Depends on type of cheque viz. Local/Outstation(Branch/Non branch)
• Customer gets credit after fixed number of days once instruments are picked up,
even if bank is not yet in funds
? Pooling of funds
• Funds collected & deposited in Central Account
• Instruments picked up at various locations, sent to appropriate clearing houses,
funds collected & credited to customer’s Pooling Account
? Control Benefits
• Corporate to maintain better control over its various Banking and Treasury
related activities
• Improve speed and ease of reconciliation and reduces the risk of fraud
6
IT Platform
CMS Sales
• Client identification
• Understand requirements
• Pricing Approval & Offer
•Documentation
CMS Operations
CPU
Delivery Channels
Branches
7
Customer Call
Understand
requirements
Collect the
information
required for pricing
Obtain the pricing
approval from
Head - CMS
Send the Offer
Letter to the client
Collect
Documentation
from the Client
Get the required line limit
approval from Head – CMS (in
case of Auto Lines- NLL) /
Credit approval process (in case
of credit line limit - LL)
Send the completed document
set to CMS CPU
Inform the client once the
setup is confirmed by
Operations and ensure send
startup instructions to the
customer
Make some post delivery calls
to ensure that all pickups/MIS
etc is happening in a timely
manner.
8
Cash Management Service
Collection or
Receivables Management
Payment or
Payables Management
Collection
Products
Disbursement
Products
9
EXPHV Local High Value Cheques at IDBI Bank
Locations
EXPRES
S
Local Collections on IDBI Bank
Locations
RAPID
REACH
(IRR)
Local Collections on Non IDBI Bank /
Partner Bank Locations
IDBITRF Cheques drawn on IDBI Bank across all
Branches
*SPEED Outstation cheques drawn on CBS
Networked Bank Branches
participating in RBI’s Speed Clearing.
CCASH Cash Deposited at IDBI locations
by CMS Clients
NCASH Cash Deposited at Non IDBI
Bank but partner bank locations
SWIFT Outstation cheques drawn On IDBI
locations
MAX
REACH
Outstation cheques drawn On Non
IDBI / Corr Bank locations i.e.
where partner bank tie up is in
place
REMOTE Outstation Collections in locations
beyond IDBI and Partner Bank
Centrs
? A Chq is a Local Chq when the Chq Payable
Location & Deposit Location is the same.
? A Chq is Outstation when the Chq Payable &
Deposit Location are different.
10
Pick Up
Location
Local IDBI
Bank Branch
Pool
Account
Local Clearing
House
Customers deposit local
cheques at IDBI branches
or the cheques are picked
up by the courier
Cheques are
sent into
clearing
Funds are credited
into a pool account
as per arrangement.
11
Pick up location
CMS
Operations
IDBI Bank Branches
Couriers SWIFT Cheques
To IDBI Bank at Drawee Locations
SWIFT Chqs from Non
IDBI locs sent to CPC
Mumbai
IDBI Bank at
Drawee
Locations
Pool A/C
12
Max Reach chqs
processed by CPC
Mumbai and
dispatched accordingly
to the Corr Bank CPC
or Corr Bank Br.
Client Credited as per
Arrangement.
Courier pick-up
From Clients Office at
Non IDBI Centers
CMS
CPC Mumbai
IDBI Bank Branches
Couriers IMR Cheques
to CPC Mumbai.
Chqs from Non IDBI
locs sent to CPC
Mumbai
? Accepting & Acknowledging receipt of cash/cheques
? Sorting of cheques
? Crossing of Cheques
? Data entry
? Return cheque processing
? Voucher checking report
? High dependency on vendors/service providers
? Delay in realisation of outstation (remote cheques) due to various
reasons
? Drawee bank not complying with RBI guidelines(14 days norm-
payment of interest for delayed credit),non co-operation
? Cash retention limits of branches, high rejection rates, absence of
adequate number of currency chests etc
? Decentralization of processing at few centres
? PROMPT PAY : Bulk Demand Draft issuance on IDBI Network. Instruments are
handed over to the customer/beneficiary.
? PROMPT PAY PLUS : Bulk Demand Drafts on Correspondent Bank Network.
DDs are printed centrally, on the Correspondent bank stationary.
? QUICK CHEQUE: Cheque Writing/Payable at Par on own bank Network with
Facsimile signatures of the client.
? EXPRO PAY: Bulk Instrument issuance on IDBI Network in the customized
format. . The data is uploaded in the Finacle system and instruments are printed
centrally and handed over to the customer.
? Last mile connectivity between Banks and Corporate which
facilitate high velocity business transaction
? Features of Host to Host Connectivity:
? Facilitates exchange of data
? Reduces Infrastructure complexities
? Less point of failure
? Improved Security
? Better transperancy
? To increase the penetration of banking services in the internal
part of the country, bank takes services from other institutions
? Institute Which provides correspondent services are:-
? Other Banks
? SHG
? MFI
? CSO
? Advantage to Bank:
? Increase penetration
? Cost Efficient
? Access to a new profitable segment in BOP market
? Advantage to Correspondent and public:
? Source of Revenue Generation
? Foster the habit of Savings
? Access to banking services like Micro Finance, etc
? Disadvantage of CBS:
? The reputation of Bank is at some others hand
? Issue relating what these institution can or cannot do (KYC,
etc)
? In competencies in handling many services
? Redressal of Grievance:
? The name and contact number of grievance redressal should
be known to public
? There should be a prompt reply to the grievance, if not address
in 60 days, complainant has an option to approach Office of
Banking Ombudsman
? Correspondent can also be done internationally with foreign
banks which doesn’t have a branch in India and the local bank
doesn’t have a branch in the foreign bank’s home country
? RBI permission is not required to set up correspondent service
(According to the letter issued by Mr P. Vijay Bhaskar-(Chief
General Manager of RBI) to all scheduled commercial bank as
on 25
th
January 2006)
doc_366066843.pptx
What is CMS?
* CMS is the process of optimizing receivable and payables ensuring predictability in the cash flows of CMS clients
* In a geographically large country like India having a complex financial clearing system, corporate find it increasingly challenging to process collections & payments across dispersed business locations.
Presented By
Adnan Abdul Kader
Piyush Das
Zeeshan Mohammad
? What is CMS
? Need for CMS
? Customer Benefits
? CMS Structure
? Client Acquisition Process
? CMS Procedure
? CMS Collection Products
? Express Local Collection
? Swift Workflow
? Max Reach Workflow
? Branch Responsibility
? Operational Constraint
? Disbursement
? Host to Host Connectivity
? Correspondent Bank
Services
? CMS is the process of optimizing receivable and payables ensuring predictability
in the cash flows of CMS clients.
? In a geographically large country like India having a complex financial clearing
system, corporate find it increasingly challenging to process collections &
payments across dispersed business locations.
? Cash Management thus means getting funds in time, quick transfers, quick
realization of local and outstation instruments, easy disbursements, accounts
reconciliation, controlled processes and customized MIS.
? Geographical spread of the country
? Complex clearing system
? Delays in cash realizations
? Uncertainty in cash flows
? Increased borrowing and associated costs
? Difficulty in collecting data / MIS on the funds
collected
? Assured Credit
• Availability of cleared funds variable
• Depends on type of cheque viz. Local/Outstation(Branch/Non branch)
• Customer gets credit after fixed number of days once instruments are picked up,
even if bank is not yet in funds
? Pooling of funds
• Funds collected & deposited in Central Account
• Instruments picked up at various locations, sent to appropriate clearing houses,
funds collected & credited to customer’s Pooling Account
? Control Benefits
• Corporate to maintain better control over its various Banking and Treasury
related activities
• Improve speed and ease of reconciliation and reduces the risk of fraud
6
IT Platform
CMS Sales
• Client identification
• Understand requirements
• Pricing Approval & Offer
•Documentation
CMS Operations
CPU
Delivery Channels
Branches
7
Customer Call
Understand
requirements
Collect the
information
required for pricing
Obtain the pricing
approval from
Head - CMS
Send the Offer
Letter to the client
Collect
Documentation
from the Client
Get the required line limit
approval from Head – CMS (in
case of Auto Lines- NLL) /
Credit approval process (in case
of credit line limit - LL)
Send the completed document
set to CMS CPU
Inform the client once the
setup is confirmed by
Operations and ensure send
startup instructions to the
customer
Make some post delivery calls
to ensure that all pickups/MIS
etc is happening in a timely
manner.
8
Cash Management Service
Collection or
Receivables Management
Payment or
Payables Management
Collection
Products
Disbursement
Products
9
EXPHV Local High Value Cheques at IDBI Bank
Locations
EXPRES
S
Local Collections on IDBI Bank
Locations
RAPID
REACH
(IRR)
Local Collections on Non IDBI Bank /
Partner Bank Locations
IDBITRF Cheques drawn on IDBI Bank across all
Branches
*SPEED Outstation cheques drawn on CBS
Networked Bank Branches
participating in RBI’s Speed Clearing.
CCASH Cash Deposited at IDBI locations
by CMS Clients
NCASH Cash Deposited at Non IDBI
Bank but partner bank locations
SWIFT Outstation cheques drawn On IDBI
locations
MAX
REACH
Outstation cheques drawn On Non
IDBI / Corr Bank locations i.e.
where partner bank tie up is in
place
REMOTE Outstation Collections in locations
beyond IDBI and Partner Bank
Centrs
? A Chq is a Local Chq when the Chq Payable
Location & Deposit Location is the same.
? A Chq is Outstation when the Chq Payable &
Deposit Location are different.
10
Pick Up
Location
Local IDBI
Bank Branch
Pool
Account
Local Clearing
House
Customers deposit local
cheques at IDBI branches
or the cheques are picked
up by the courier
Cheques are
sent into
clearing
Funds are credited
into a pool account
as per arrangement.
11
Pick up location
CMS
Operations
IDBI Bank Branches
Couriers SWIFT Cheques
To IDBI Bank at Drawee Locations
SWIFT Chqs from Non
IDBI locs sent to CPC
Mumbai
IDBI Bank at
Drawee
Locations
Pool A/C
12
Max Reach chqs
processed by CPC
Mumbai and
dispatched accordingly
to the Corr Bank CPC
or Corr Bank Br.
Client Credited as per
Arrangement.
Courier pick-up
From Clients Office at
Non IDBI Centers
CMS
CPC Mumbai
IDBI Bank Branches
Couriers IMR Cheques
to CPC Mumbai.
Chqs from Non IDBI
locs sent to CPC
Mumbai
? Accepting & Acknowledging receipt of cash/cheques
? Sorting of cheques
? Crossing of Cheques
? Data entry
? Return cheque processing
? Voucher checking report
? High dependency on vendors/service providers
? Delay in realisation of outstation (remote cheques) due to various
reasons
? Drawee bank not complying with RBI guidelines(14 days norm-
payment of interest for delayed credit),non co-operation
? Cash retention limits of branches, high rejection rates, absence of
adequate number of currency chests etc
? Decentralization of processing at few centres
? PROMPT PAY : Bulk Demand Draft issuance on IDBI Network. Instruments are
handed over to the customer/beneficiary.
? PROMPT PAY PLUS : Bulk Demand Drafts on Correspondent Bank Network.
DDs are printed centrally, on the Correspondent bank stationary.
? QUICK CHEQUE: Cheque Writing/Payable at Par on own bank Network with
Facsimile signatures of the client.
? EXPRO PAY: Bulk Instrument issuance on IDBI Network in the customized
format. . The data is uploaded in the Finacle system and instruments are printed
centrally and handed over to the customer.
? Last mile connectivity between Banks and Corporate which
facilitate high velocity business transaction
? Features of Host to Host Connectivity:
? Facilitates exchange of data
? Reduces Infrastructure complexities
? Less point of failure
? Improved Security
? Better transperancy
? To increase the penetration of banking services in the internal
part of the country, bank takes services from other institutions
? Institute Which provides correspondent services are:-
? Other Banks
? SHG
? MFI
? CSO
? Advantage to Bank:
? Increase penetration
? Cost Efficient
? Access to a new profitable segment in BOP market
? Advantage to Correspondent and public:
? Source of Revenue Generation
? Foster the habit of Savings
? Access to banking services like Micro Finance, etc
? Disadvantage of CBS:
? The reputation of Bank is at some others hand
? Issue relating what these institution can or cannot do (KYC,
etc)
? In competencies in handling many services
? Redressal of Grievance:
? The name and contact number of grievance redressal should
be known to public
? There should be a prompt reply to the grievance, if not address
in 60 days, complainant has an option to approach Office of
Banking Ombudsman
? Correspondent can also be done internationally with foreign
banks which doesn’t have a branch in India and the local bank
doesn’t have a branch in the foreign bank’s home country
? RBI permission is not required to set up correspondent service
(According to the letter issued by Mr P. Vijay Bhaskar-(Chief
General Manager of RBI) to all scheduled commercial bank as
on 25
th
January 2006)
doc_366066843.pptx