NEFT Inbound Payments - Returns Processing
For the NEFT Inbound Payments, the returns processing as per B+2 Settlement cycle:
- The Beneficiary bank must credit the beneficiary or return the transaction (N07) to the originating bank within B+2 hours or else it would have to be returned as NEFT Outgoing transactions (N06), wherein B is Batch Time received in the N02 message. Return cutoff time is captured in Network Maintenance.
- The Return can be initiated for the below reasons:
- Inward Credit to a NRE account from a Non-NRE account
- Invalid Beneficiary account
- Rejection/Cancellation from the Incoming Exception queues (such as Process Exception/Business Override/Repair Queue/Authorization Limit Check/ Sanction Check/Pricing Queue/EAC)
- Returns (Cancel action) can be done from any Queue where user can input the Return reason Code and Return Reason.
- All manual rejection within B+2 settlement period generates N07 message.
- As per the changes to support B+2 settlement cycle, the batch time in N07 is sent as the next available batch time. User does not have option to input/modify the batch time.
- The below screen is launched to handle returns manually and generate N07 within
B+2 cutoff time.
Figure 5-1 Cancel Details
On approving Cancel Action from Exception Queues, Inbound transaction is liquidated to Return GL and the transaction is marked as 'Return Initiated'.
| Event | Dr/Cr | Account | Account Type | Amount Tag |
|---|---|---|---|---|
| DRLQ | Dr | Network Clearing GL | GL | XFER_AMT |
| CRLQ | Cr | Intermediary GL | GL | XFER_AMT |
| DRLQ | Dr | Intermediary GL | GL | XFER_AMT |
| CRLQ | Cr | Return GL | GL | XFER_AMT |
You have to maintain a source code as INBOUNDN0 with Prefunded GL flag checked and Prefunded GL as Return GL. Source Network Preferences for transaction Type 'Outgoing' is to be maintained.
An outbound transaction is auto created on processing the return of incoming NEFT
transactions, with 'Prefunded GL' flag checked. Outbound transaction Reference is
populated as Return reference of the original inbound transaction. The mapping for the
outbound transaction is detailed in the below table:
| Outbound Transaction Fields | Mapping Details |
|---|---|
| Host Code, Transaction Branch & Network Code | Same as Inbound Transaction |
| Source Code | INBOUNDN02 |
| Transaction Reference | Return Reference |
| UTR Number | Return Reference |
| Source Reference | Inbound Transaction Reference |
| Return of Inbound Flag | Marked as Yes |
| Prefunded Flag | Checked |
| Booking Date | Current Date |
| Value Date | Current Date |
| Activation Date | Current Date |
| Transaction Currency & Amount | As received in Inbound Transaction |
| Debtor Details | Beneficiary Details of Inbound transaction |
| Beneficiary Details | Debtor Details of Inbound Transaction |
| Beneficiary Bank Details | Debtor Bank Details of Inbound Transaction |
| Additional Details - Debtor Address | Beneficiary Address Details of inbound transaction |
| Additional Details - Beneficiary Address | Debtor Address Details of inbound transaction |
| Sender to Receiver Information | Third line populated as Return of |
| Event | Dr/Cr | Account | Account Type | Amount Tag |
|---|---|---|---|---|
| DRLQ | Dr | Return GL | GL | XFER_AMT |
| CRLQ | Cr | Intermediary GL | GL | XFER_AMT |
| DRLQ | Dr | Intermediary GL | GL | XFER_AMT |
| CRLQ | Cr | Network Clearing GL | GL | XFER_AMT |
Return cutoff time check
- If Return cutoff time is over, the Return Message Type is updated as N06 and generation of N06 is done similar to normal outbound transactions.
- If Return cutoff time is not yet reached, Return Message Type is updated as N07.
Dispatch Processing of N07 Messages
- System checks whether N04 message is received for the Original inbound N02 message. If yes, N07 message record is marked as 'Ready for Dispatch'.
- Only the records marked as Ready for Dispatch is picked up for N07 generation.
- When the generation of N06/N07 message is completed for transactions, then the related Inbound transaction status is marked as 'Returned'.
Parent topic: NEFT Inbound Return Payments