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In one of the first moves of its kind in the Indian Railways, the Construction organization of South East Central Railway has successfully been able to implement a unique scheme involving Electronic Fund Transfer (EFT) and Remote Pay-out through Demand Draft and Pay-orders in making payment to all Contractors/Suppliers through a specified bank (UTI Bank, Bilaspur, in the instant case). The scheme has been introduced w.e.f. 16th Feb’04. 

The introduction of the schemes has led, on the one hand, to substantial saving for the Railways in terms of reduced man-power requirement for the cash and pay office while, on the other, has greatly expendited the process of making payment to Contractor/Suppliers across states and regions.

As a logical sequel to the introduction of the scheme, individual cheques in favour of each Contractor/Supplier are not being made out and disbursed by the Cash and Pay Office.

A consolidated cheque , in lieu thereof , is being handed over to the UTI Bank, Bilaspur, by 10:00 am every day along with a list of beneficiaries (Contractors/Suppliers).

The UTI Bank is sending the cheque for clearance immediately on receipt and, on realization of the  amount, initiating the process of crediting  beneficiaries’ accounts as per the following modules:-

Direct credit through EFT 

The accounts of all beneficiaries having bank account with any bank situated at any of the fifteen cities designated by the RBI ( Ahmedabad, Banglore, Bhubhneshwar, Chandigarh, Chennai, Guwahati, hydrabad, Jaipur, kanpur, Kolkata, Mumbai, Nagpur, New Delhi, Thiruvanamthapuram and Patna) would get automatically credited on Day-1 through operation of the Electronic Fund Transfer scheme by the UTI Bank, Bilaspur, in collaboration with RBI. However, those beneficiaries who would be having an account with

UTI Bank anywhere in India would have their accounts credited on Day-0 instead of Day-1.

Remote Pay-out

Payment through Remote Pay-out would be made to beneficiaries who are located at places where the EFT scheme is not applicable but where a branch of UTI Bank exists like Bhopal, Raipur etc.  

In such cases, pay-orders would be generated by the local UTI Bank as per instructions received from the UTI Bank/Bilaspur and delivered through courier to the residence/office of the beneficiaries latest by Day-2. The beneficiaries would be free to have an account with any bank of their choice.

Demand Drafts

Payment through this mode will be done to beneficiaries who are located at places where neither a UTI Bank branch nor RBI exists.

In such cases payment would be done through issue of Demand Drafts by a local Bank/Post office with whom UTI Bank/Bilaspur, would have the necessary tie-up or by sending the same (D.D.) directly from UTI Bank/Bilaspur, through courier to the office/ residence of beneficiaries at these places on Day-2.

No charges whatsoever will be levied by UTI Bank/Bilaspur for issuing these demand drafts or for delivering them to the beneficiaries under any of these modes.

      A salient feature of the contract entered with UTI Bank/Bilaspur is that  in the event of any failure by them to make payments as per the above schedule in the relevant mode as applicable in the case of individual beneficiary, the beneficiaries will be compensated  by UTI Bank/Bilaspur, at the prevailing prime lending rate of interest for every day of delay by issue of separate pay orders directly to the beneficiaries. S.E.C. Railway will have the right to watch this is done by UTI Bank/Bilaspur.

 After ensuring timely payment through the above modes to the beneficiaries ,UTI Bank Ltd., Bilaspur, will send an MIS in Railway’s format detailing therein the status of disbursal of payment to each beneficiary against a consolidated cheque  by the 5th working day from the date of issue of the consolidated cheque to the office of FA&CAO/Con, SECR, Bilaspur. In addition, at the end of every month, a monthly statement of transactions showing disbursal of payments through the above modes shall be made out by UTI Bank/Bilaspur,  along with details of pay-orders issued on account of delayed payment, if any, and  submitted to the Office of the FA&CAO/Con, SECR, Bilaspur. This monthly statement in Railway’s format should reach the office of FA&CAO/Con,SECR, Bilaspur, by the 7th working day of the following month. In the  event of failure by UTI Bank/Bilaspur, to submit the statements as detailed above within the stipulated time period or for submission of improper statement, S.E.C. Railway  acting through FA&CAO/Con would retain the right to impose penalty on UTI Bank/Bilaspur, at the rate of Rs.100/- per day for each day of delay in submission of each type of statement.  

Introduction of this system, as pointed out earlier, has resulted in considerable saving of time for performance of different activities in the office of FA&CAO/Con. This is mainfest from the following flow chart:-



 

Activity Flow Chart

 

Under the Old System

Under the New System

1.

Co7s prepared (through TAS)

1.

Co7s prepared (through TAS)

 

 

 

 

2.

Co7s passed by A/Cs officer

2.

Co7s passed by A/Cs officer

 

 

 

 

3.

Preparation of Cheque Summary (through TAS)

3.

Preparation of Cheque Summary (through TAS)

 

 

 

 

4.

Cheques are written in favour of each Contractor/Supplier by Cheque Writer(10 cheques app.X 5 mins per

 cheque= 50 mins app.)

4.

Only single cheque is written by Cheque Writer (5 mins.)

 

A Beneficiaries List prepared for Bank (manually) =20 mins. This will be computerized shortly through development  of  a small Program linked to TAS reducing time for  the activity to < 5 mins.

 

 

 

 

5.

All cheques are verified by Section Officer(40 mins.app)

5.

Single cheque is verified by Section Officer along with beneficiaries list (5 mins.)

 

 

 

 

6.

 Cheques are signed by two Accounts Officers.

     (1 hr app-30 mins. for each

      Accounts officer)

6.

Single cheque along with

beneficiaries list is signed by

two Accounts Officers (10 mins.)

 

 

 

 

7.

All cheque nos entered in

Cheque Summary Statement

(15 mins.)

7.

Single Cheque No. entered in

Cheque Summary Statement

 (30 Sec.)

 

 

 

 

8.

Preparation of Bill Register

 indicating bills and cheques

 to be handed over to cashier.

(through TAS)

8.

Preparation of Bill Register

 indicating bills and cheques to

be handed over to cashier

(through TAS)

 

 

 

 

9.

Handing over of bills and 
cheques along with Cheque 
Summary to cashier
 (15 mins.)

9.

Handing over of bills and

one cheque along with Cheque summary to cashier (5 mins.)

 

 

 

 

10.

Cashier makes entries in

his cash book of all bills

(30 mins.)

10.

Cashier makes entries in his

cash book of all bills  (30 mins.)

 

 

 

 

11.

Cashier makes entries of 

all cheques in Cheque Register

(45 mins.)

11.

Cashier makes entry of

single cheque in Cheque Register

(1 min.)

 

 

 

 

12.

Cheques are handed over to

payees or sent by regd. post by

Cashier (1 day)

12.

Single cheque along with

beneficiaries list handed over to

UTI Bank’s representative by

 cashier (1 min.)

 

 

 

 

13.

Some cheques are converted

into drafts by cashier by

going to bank (1 day)

13.

No cheques are converted

to drafts by cashier

( Saving of 1 day)

 

 

 

 

14.

Paid bills with party’s

acknowledgement/postal receipt

sent back to A/Cs office by

cashier after 21 days.

14.

Beneficiaries list duly

acknowledged by Bank along

with bills returned by Cashier

to A/Cs office the following day.

 

 

 

 

15.

Post audit section in A/Cs office

Checks paid bills and verifies

acknowledgements (2 hrs.)

15.

Post-audit section in A/Cs

 office Checks beneficiaries

list duly acknowledged by

bank (2 mins)

 

 

 

 

16.

Acquittance certificate to the

cashier issued by A/Cs office.

16.

Acquittance certificate to

cashier issued by A/Cs

 office.

 

 

 

 

Total time required from generation of CO7 to disbursal of cheque by Cashier

 

 

 

 

Under the old system

Under the new system

22 Hours 15 mins

1 Hour 19 mins

 




Source : South East Central Railway CMS Team Last Reviewed on: 23-07-2014  


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