FORM 2
THE PATENTS ACT, 1970
(39 of 1970)
&
THE PATENTS RULES, 2003
COMPLETE SPECIFICATION
(See section 10, rule 13)
/. Title of the invention: REAL-TIME SETTLEMENT OF TRANSACTIONS
2. Applicant(s)
NAME NATIONALITY ADDRESS TATA CONSULTANCY Indian Nirmal Building, 9th Floor, Nariman SERVICES LIMITED Point, Mumbai, Maharashtra 400021, India
3. Preamble to the description
COMPLETE SPECIFICATION
The following specification particularly describes the invention and the manner in which it
is to be performed.

TECHNICAL FIELD
[0001] The present subject matter relates, in general, to settlement of transactions and,
particularly but not exclusively, to real-time settlement of transactions.
BACKGROUND
[0002] With the advent of the technology, paperless banking has become the preferred
mode of banking as compared to traditional modes of banking. Different modes of paperless banking include internet banking, mobile banking, Automated Teller Machines (ATM), Electronic Fund Transfer (EFT), etc. Paperless banking allows customers of one financial institution to perform financial transactions with other financial institutions, electronically, through a communication network. Generally, paperless banking facilitates transfer of funds and settlement of transactions, electronically, between different financial institutions, in a simple and a user friendly manner. Some of the well known methods used for the transfer of funds and settlement of transactions between the different financial institutions include, National Electronic Fund Transfer (NEFT), Real Times Gross Settlement (RTGS) and Electronic Clearing Service (ECS).
BRIEF DESCRIPTION OF DRAWINGS
[0003] The detailed description is described with reference to the accompanying figures.
In the figures, the left-most digit(s) of a reference number identifies the figure in which the reference number first appears. The same numbers are used throughout the drawings to reference like features and components.
[0004] Fig. la illustrates a network environment implementing Real Time Settlement
(RTS) Systems, in accordance with an embodiment of the present subject matter.
[0005] Fig. lb illustrates components of RTS systems, in accordance with an
embodiment of the present subject matter.
[0006] Fig. 2 illustrates a method for real-time settlement of transactions, in accordance
with an embodiment of the present subject matter.

[0007] It should be appreciated by those skilled in the art that any block diagrams herein
represent conceptual views of illustrative systems embodying the principles of the present subject matter. Similarly, it will be appreciated that any flow charts, flow diagrams, state transition diagrams, pseudo code, and the like represent various processes which may be substantially represented in computer readable medium and so executed by a computer or processor, whether or not such computer or processor is explicitly shown.
DETAILED DESCRIPTION
[0008] Conventionally, transfer of funds and settlement of transactions between the
different financial institutions takes place using well known settlement systems and methods
including Electronic Clearing Service (ECS), National Electronic Fund Transfer (NEFT) and
Real Times Gross Settlement (RTGS). Generally, the ECS facilitates the settlement of
transactions, between financial institutions, that are periodic in nature such as payments of
interest or salary or dividend. ECS is of two types, namely, ECS credit and ECS debit. In the
ECS credit, a large number of beneficiaries are credited by raising a single debit to an account.
Examples of ECS credit include dividend, interest or salary payment. On the other hand, the ECS
debit raises respective debits from different account holders or customers in different financial
institutions in order to credit a beneficiary account. Examples of ECS debit include utility-bill-
payments such as telephone bills, electricity bills, card payments and loan repayments.
[0009] Generally, the settlement of transactions mediated through the ECS, are routed
through a third party electronic network. Automated Clearing House (ACH), where money is
debited from the consumer's demand deposit account (DDA), such as a checking account or
savings account, of one financial institution, and credited to the other financial institution
through the ACH. The ACH allows clearing and settlement of electronic payments for
participating financial institutions, in a batch mode, where all the fund settlement requests
received from one financial institution during the day, are processed and settled at periodic
intervals by the ACH, and the funds are further settled with the other financial institution on the
next business day or within 48 hours. Therefore for many small transactions, where the
settlements are time sensitive, a settlement lag of about 1-2 days, is disadvantageous.
[0010] Certain other methods of electronic fund settlement are National Electronic
Funds Transfer (NEFT) and Real Time Gross Settlement (RTGS). The NEFT facilitates one-to-one funds transfer, where individuals and firms of one financial institution can electronically

transfer funds to any individual and firm owning an account with another financial institution, through a network. This method of fund transfer operates on a Deferred Net Settlement (DNS), where payments are cleared and settled on a net basis at fixed hours, either once or several times during the settlement day. Typically, the time taken for the NEFT to allow settlement of transactions between the participating financial institutions is within 1-2 hours. However, in cases, where the request for settlement of transactions, is initiated after the batch settlement time, the funds are credited only on the following day. The RTGS overcomes this disadvantage such that, the funds are settled on a continuous, individual basis, where transfer of money or securities from one financial institution to another occurs on a "real time" and on "gross" basis. Hence, transfers made are quick and can be helpful in emergencies, where funds are settled on a close to real-time basis, i.e., within minutes. However, the RTGS is primarily meant for large value transactions and may not be an option for customers who wish to settle funds of small amounts on a real-time basis.
[0011] Such conventional systems and methods, incur significant delay in settlement of
the transactions that may extend from hours to days. Further, the settlement of transactions is
made possible only during the business hours and on week days and therefore, may be
inconvenient for the customers who wish to settle transactions on weekends, on holidays, and on
weekdays after the business hours. For example, if a customer wishes to settle transactions with
another financial institution at 10 PM, the funds are processed and settled only on the following
business day. In such cases, where there is a settlement lag of either, days or hours between the
initiation of payment and their final settlement, the time value for money is affected. Further, in
cases where the settlement lag is high, there is a possibility that the customer may be incurred
with high penalties due to failure to settle obligations when due. Moreover, the entire process of
registering for the electronic fund settlements systems is time consuming and cumbersome.
[0012] The present subject matter describes systems and methods for real-time
settlement of transactions. According to the present subject matter, settlement of transactions between the financial institutions takes place automatically using the Automated Teller Machine (ATM) switches of the financial institutions, and the transactions are routed through a common financial switch over a financial network. The systems and methods are end-to-end automated and accordingly the transactions are settled in real-time. Moreover, such transactions can be

facilitated on non-working days, holidays, and also after the business hours on working days as well.
[0013] The settlement of transactions in the present subject matter is mediated by
settlement systems, such as ECS and other allied process like NEFT and RTGS, and such settlement systems are collectively referred to as Electronic Fund Settlement (EFS) systems hereinafter. According to one implementation of the present subject matter, an EFS mandate corresponding to transactions mediated through ECS, NEFT and RTGS, is obtained by a first financial institution. In said implementation, the financial institutions may include banks and other institutions capable of providing financial services to clients or customers. The EFS mandate contains particulars, such as account details including name, address and branch of an account holder, account details of a beneficiary account, details including Magnetic Ink Character Recognition (MICR) code, sort code and its equivalents, such as, Indian Financial System Code (IFSC) of a second financial institution associated with the beneficiary account. In one example, the account holder may be a customer or company, and the beneficiary may be a stakeholder, a financing intuition, a utility firm and the like. The particulars of the EFS mandate may further include a predefined date on which the transactions are to be performed or executed, a start date of the EFS mandate, an end date of the EFS mandate, transaction amount, and the like. Along with the EFS mandate, a cancel cheque may also be obtained from the account holder.
[0014] In one implementation, the EFS mandate is validated by the first financial
institution, where the validation includes verifying the particulars in the EFS mandates with the account holder and matching the signature of the account holder as provided on the cancel cheque with a specimen signature of the account holder registered in the first financial institution. Such a validation may be carried out manually, automatically or semi-automatically. After validation, the EFS mandate is uploaded into an Automated Teller Machine (ATM) switch of the first financial institution through respective banking systems in the financial institution in either a manual or an automated manner.
[0015] In one implementation, the EFS mandate is stored into the ATM switch of the
first financial institution. In said implementation, the EFS mandate may be stored in the format analogous to that of the ATM card data that is generally stored at the ATM switch. The analogy may be better understood by mapping each of the particulars of the EFS mandate to each

corresponding datum of the ATM card. For example, the start date and end date in the EFS
mandate can be mapped to the "from date" and "expiry date" on the ATM card.
[0016] The EFS mandate stored in the ATM switch of the first financial institution is
then transmitted to a ATM switch of the second financial institution through a financial switch. In an example, EFS mandate stored in the ATM switch of the first financial institution is primarily transmitted to the financial switch over a financial network, and the financial switch further routes the EFS mandate to an ATM switch of a second financial institution, based on the particulars provided in the EFS mandate. In one implementation, the financial network may be an ATM network. NFS network or the like, and the financial switch may be an ATM switch, a NFS switch or the like. In one implementation, the EFS mandate may be transmitted to the ATM switch of the second financial institution in an encrypted format. Various communication protocols, including ISO-8583 may be used, to facilitate the receipt and transmission of the EFS mandate, in an encrypted format, between the ATM switches of both the financial institutions, thereby ensuring that the EFS mandate is stored in the ATM switches of both the financial institutions.
[0017] The EFS mandate received by the ATM switch of the second financial institution
is authorized by the second financial institution for subsequent future transaction operations invoked by financial switch of the first financial institution for real-time settlement of the transactions. In one implementation, the authorization includes downloading the EFS mandate to a banking system, such as Core Banking Solutions (CBS) or other similar systems of the second financial institution, and validating the EFS mandates based on comparing the particulars in the received EFS mandate to the account details of the beneficiary account in the second financial institution. The second financial institution may approve or reject the mandate validation. Upon approval of the EFS mandate by the second financial institution, an acknowledgement of the approval is sent to the first financial institution through the financial switch. It is to be understood that the ATM switches of both the financial institutions may have the EFS mandates stored at their respective ATM switches for future execution of transactions and real-time settlement of funds. Once the EFS mandate is authorized, the second financial institution may execute the transaction(s), periodically, according to the particulars of the EFS mandate. For example, the transaction may be executed on a predefined date of every month staring from the start date of the EFS mandate till the end date of the EFS mandate. For example, the transaction

is invoked or triggered on the predefined date specified in the particulars of the EFS mandate, and is subsequently executed and settled in real-time. In one implementation, the execution of the transaction involves, pulling the funds equivalent to the transaction amount specified in the EFS mandate from an account of the account holder associated with the first financial institution, and subsequently crediting the funds into the beneficiary account associated with the second financial institution. Both pulling and crediting of funds take place through the financial switch over the financial network.
[0018] In one implementation, when a transaction is invoked, the second financial
institution interact with the banking systems, such as, CBS of the first financial institution to either approve or reject the transaction. The approval or rejection of the transaction may be based on referring checks, such as, balance amount check. After receiving an approval, the second financial institution pulls funds from the account of the account holder associated with the first financial institution and credits the funds into the beneficiary account associated with the second financial institution. In one implementation, funds are settled through a financial switch banking system implemented at the financial switch level as the execution of all the transactions are routed through the financial switch. In said implementation, the financial switch banking system may facilitate net settlement of transactions either synchronously, at predefined periodic intervals, based on receipt of a settlement file from the respective financial institutions participating in the interbank fund settlements.
[0019] In an implementation, upon receiving a rejection of financial transaction by the
first financial institution, through the financial switch, the respective banking system, such as CBS, of the second financial institution may perform re-polling's of the declined transactions periodically at predefined intervals, say three times. Additionally, the re-polling can be configured to be carried out at predefined intervals at a parameterized frequency, say, three times a day.
[0020] The implementation of the described systems and methods of the present subject
matter allow real-time settlement of transactions performed through ECS and allied process like NEFT and RTGS, by utilizing the financial switch over the financial network. Further, since the method involves interaction between the ATM switches or machines of the financial institutions, through a financial switch, this method enables ECS and other allied process like NEFT and RTGS to facilitate real-time settlement of transactions at any time of the day, including holidays

and non-working hours. Furthermore, since this method stores the EFS mandates at the ATM switches, modification or cancellation of the EFS mandate by utilizing the ATM or any other computing device as a Graphical User Interface (GUI) is made possible, thereby easing the process for an end customer or account holder. In addition, the present subject matter adopts a straight through process by circumventing manual uploads and downloads, thereby meeting the objective of paperless banking.
[0021] It should be noted that the description merely illustrates the principles of the
present subject matter. It will thus be appreciated that those skilled in the art will be able to devise various arrangements that, although not explicitly described herein, embody the principles of the present subject matter and are included within its spirit and scope. Furthermore, all examples recited herein are principally intended expressly to be only for pedagogical purposes to aid the reader in understanding the principles of the present subject matter and the concepts contributed by the inventor(s) to furthering the art, and are to be construed as being without limitation to such specifically recited examples and conditions. Moreover, all statements herein reciting principles, aspects, and embodiments of the present subject matter, as well as specific examples thereof, are intended to encompass equivalents thereof.
[0022] The manner in which the systems and methods shall be implemented has been
explained in detail with respect to Fig. la, lb and 2. Methods can be implemented in systems that include, but are not limited to, computing devices such as, desktop computers, hand-held devices, laptops or other portable computers, advanced cellular phones, tablets, notebooks, ATM machines and the like, capable of establishing settlement of transactions between financial institutions through a communication network. Although the description herein is with reference to ATM, the methods and systems may be implemented in to other computing devices, as will be understood by a person skilled in the art. Further, while aspects of described systems and methods can be implemented in any number of different computing systems, transmission environments, and/or configurations, the implementations are described in the following system(s).
[0023] Fig. la illustrates a network environment 100 implementing Real Time
Settlement (RTS) systems, for real-time settlement of transactions, in accordance with an embodiment of the present subject matter. The network environment 100 may include Automated Teller Machine (ATM) switches 104-1 and 104-2, of the first and the second

financial institution respectively, and are collectively referred to as ATM switch 104. The RTS
systems 102-1 and 102-2, collectively referred to as RTS system 102, are communicatively
coupled to the ATM switches 104. In one implementation, the RTS system 102-1 is
communicatively coupled to the ATM switch 104-1 and the RTS system 102-2 is
communicatively coupled to the ATM switch 104-2. respectively. In another implementation, the
RTS system 102-1 may be implemented within the ATM switch 104-1. and the RTS system 102-
2 may be implemented within the ATM switch 104-2. In yet another implementation, the RTS
systems 102 can be integrated within the respective banking systems, such as core banking
solutions of the financial institutions. Further, the ATM switches 104-1 and 104-2 are
interconnected through a financial switch 106 over a financial network 108. The financial switch
106 may be a National Financial Switch capable of inter-connecting ATM switches 104 of
various financial institutions 104-1 and 104-2. In another implementation, the financial network
108 may include an ATM network. In one implementation, the financial switch 106 may be
communicatively coupled to a financial switch banking system 107 to facilitate net settlement of
transactions between the participating financial institutions for interbank fund settlements.
[0024] The RTS system 102-1 is further connected to one or more computing devices
and financial institutions 110-1, 110-2... 110-N through a communication network (not shown in the fig.). The financial institutions are individually and collectively referred to as 110 hereinafter. The computing devices 108 may include an ATM, laptop computer, a desktop computer, a notebook, a workstation, a mainframe computer, a server, and the like. Similarly, the RTS system 102-2 is further connected to other computing devices and financial institutions 112-1, 112-2,...112-N through a communication network. The financial institutions are individually and collectively referred to as 112 hereinafter. The communication network described herein may be a wireless or a wired network, or a combination thereof
[0025] In one implementation, the RTS systems 102 facilitate real-time settlement of
transactions through the financial switch 106. The manner in which the transactions are settled in real-time by different components of the RTS systems 102 is described in detail with reference to the Fig. lb. Fig. lb illustrates components of the RTS systems 102, in accordance with an embodiment of the present subject matter. In one implementation, the RTS system 102-1 and 102-2 includes processor(s) 114-1 and 114-2. The processors 114-1 and 114-2 may be implemented as one or more microprocessors, microcomputers, microcontrollers, digital signal

processors, central processing units, state machines, logic circuitries, and/or any devices that manipulate signals based on operational instructions. Among other capabilities, the processors 114-1 and 114-2 are provided to fetch and execute computer-readable instructions stored in the memory.
[0026] Also, the RTS systems 102-1 and 102-2 include interfaces 116-1 and 116-2
respectively. The interface(s) 116-1 and 116-2 may include a variety of software and hardware interfaces that allow the RTS systems 102-1 and 102-2 to interact with the entities of the network, or with each other. The interfaces 116-1 and 116-2 may facilitate multiple communications within a wide variety of networks and protocol types, including wire networks, for example, LAN, PSTN, cable, etc., and wireless networks, for example, WLAN, cellular, satellite-based network, etc.
[0027] In another embodiment of the present subject matter, the RTS systems 102-1 and
102-2 may also include memory 118-1 and 118-2 respectively. The memory 118-1 and 118-2
may be coupled to the processors 114-1 and 114-2 respectively. The memory 118-1 and 118-2
can include any computer-readable medium known in the art including, for example, volatile
memory, such as static random access memory (SRAM) and dynamic random access memory
(DRAM), and/or non-volatile memory, such as read only memory (ROM), erasable
programmable ROM, flash memories, hard disks, optical" disks, and magnetic tapes.
[0028] Further, the RTS systems 102-1 and 102-2 may include modules 120-1 and 120-
2 and data 122-1 and 122-2. The modules 120-1 and 120-2 and the data 122-1 and 122-2 may be
coupled to the processors 114-1 and 114-2 respectively. The modules 120-1 and 120-2, amongst
other things, include routines, programs, objects, components, data structures, etc., which
perform particular tasks or implement particular abstract data types. The modules 120-1 and 120-
2 may also be implemented as, signal processor(s), state machine(s), logic circuitries, and/or any
other device or component that manipulate signals based on operational instructions.
[0029] Further, the modules 120-1 and 120-2 can be implemented in hardware,
instructions executed by a processing unit, or by a combination thereof. The processing unit can comprise a computer, a processor, a state machine, a logic array or any other suitable devices capable of processing instructions. The processing unit can be a general-purpose processor which executes instructions to cause the general-purpose processor to perform the required tasks or, the processing unit can be dedicated to perform the required functions. In another aspect of the

present subject matter, the modules 120-1 and 120-2 may be machine-readable instructions (software) which, when executed by a processor/processing unit, perform any of the described functionalities. The machine-readable instructions may be stored on an electronic memory device, hard disk, optical disk or other machine-readable storage 'medium or non-transitory medium. In one implementation, the machine-readable instructions can be also be downloaded to the storage medium via a network connection.
[0030] In an implementation, the modules 120-1 include a mandate receiving module
124-1, a mandate transmission module 126-1. an authorization module 128-1, an execution module 130-1 and other modules 132-1. Likewise, the modules 120-2 include a mandate receiving module 124-2, a mandate transmission module 126-2, an authorization module 128-2. an execution module 130-2 and other modules 132-2. The other module(s) 132-1- and 132-2 may include programs or coded instructions that supplement applications or functions performed by the RTS systems 102-1 and 102-2 respectively. In said implementation, the data 122-1 include an EFS mandate data 134-1, and other data 136-1, and the data 122-2 include an EFS mandate data 134-2 and other data 136-2. The other data 136-1 and 136-2 amongst other things, may serve as a repository for storing data that is processed, received, or generated as a result of the execution of one or more modules in the module(s) 120.
[0031] The RTS systems 102-1 and 102-2, as disclosed with reference to fig. la,
facilitate real time settlement of transactions, through the financial switch 106, over a financial network 107. In one embodiment, the mandate receiving module 124-1 of RTS system 102-1 may obtain an Electronic Fund Settlement (EFS) mandate 138 through, through an interface 116-1. The EFS mandate 138 may include particulars, such as account details including name, address and branch of an account holder, account details of a beneficiary account, details including Magnetic Ink Character Recognition (MICR) code, sort code and its equivalents, such as, Indian Financial System Code (IFSC) of a second financial institution 112 associated with the beneficiary account. Further, the particulars of the EFS mandate 138 may include a predefined date on which the transactions are to be performed or executed, a start date of the EFS mandate 138, an end date of the EFS mandate 138 , transaction amount, and the like. Along with the EFS mandate 138, a cancel cheque may also be obtained from the account holder. The EFS mandate 138 may allow settlement of transactions mediated through EFS and other allied process like

NEFT and RTGS, and such settlement systems are collectively referred to as Electronic Fund Settlement (EFS) systems.
|0032] In one implementation, the mandate receiving module 124-1 of RTS 102-1 may
obtain an EFS mandate 138. In one example, the EFS mandate 138 may be a validated EFS mandate. The validation of the EFS mandate may include receiving an EFS mandate 138 by the first financial institution 110 and validation of the received EFS mandates 138, by bank personnel's based on comparing the particulars of the EFS mandate with the account details registered with the first financial institution 110. Further, the validation may include comparison of the signature on the cancel cheque provided by the account holder with the specimen signature of the account holder. In one implementation, upon validation, a unique reference number specific to each validated EFS mandate 138 may be generated and associated with the validated EFS mandate. Such a validated EFS mandate is uploaded into the ATM switch 104-1 of the first financial institution 110, by the mandate receiving module 124-1.
[0033] In one implementation, the mandate receiving module 124-1 uploads the EFS
mandate into the ATM switch 104-1 in a format analogous to of the format of an ATM card data. For this purpose, the mandate receiving module 124-1 is configured to map each of the particulars of the EFS mandate 138 to a corresponding datum of the ATM card. For example, the "start date" and "end date" in the EFS mandate may be mapped to the "from date" and "expiry date" of the ATM card. Similarly, the reference number that is unique to each validated EFS mandate may be mapped to an ATM card number that is unique to each card. Further, the transaction amount input in the EFS mandate 138 may be mapped to the withdrawal amount of the ATM card. In one example, the mandate receiving module 124 may also store the EFS mandate 138 as the EFS mandate data 134 within the RTS system 102-1.
[0034] The mandate transmission module 126-1, for example, triggers the ATM switch
102-1 to transmit the stored EFS mandate 138 to an ATM switch 102-2 of the second financial institution through a financial switch 106. In one implementation, the mandate transmission module 126-1 can be configured to trigger the ATM switch 102-1 to transmit the EFS mandate 138 stored in the EFS mandate data 134-1 as soon as the ATM switch 102-1 receives the EFS mandate 138. In another implementation, the mandate transmission module 126-1 can be configured to trigger the ATM switch 102-1 to transmit the stored EFS mandate(s) 138 at predefined intervals. The transmission of the EFS mandate 138 from the ATM switch 104-1 to

the ATM switch 104-2 is routed through the financial switch 106, over the financial network 108. The mandate transmission module 126, in one implementation, may encrypt the EFS mandate 138 before transmission. Various communication protocols including ISO-8583 may be used, to facilitate the receipt and transmission of EFS mandates 138, in an encrypted format, between the ATM switch 104-1 and the ATM switch 104-2, for enabling real-time settlement of transactions, through the financial network 108. In one implementation, the financial network 108 is an ATM network.
[0035] The EFS mandate 138 received by the ATM switch 104-2, is accessed by the
second financial institution 112 for authorizing the real-time settlement of transaction based on the validation of the EFS mandate 138 by the first financial institution 110. The EFS mandate 138 received by the ATM switch 104-2 are downloaded to banking systems, for example, the Core Banking Solutions (CBS) of the second financial institution 112, where the second financial institution 112 validates the received EFS mandates 138 based on comparing the particulars in the EFS mandates 138 to the existing records, to authorize the transaction process. The second financial institution 112 may authorize settlement of transaction, for the validated EFS mandates 138. Further, the validated EFS mandates 138 are further received by the ATM switch 104-2 of the second financial institution 112. In one implementation, the authorization module 128-2 of the RTS system 102-2 may receive the validated EFS mandate 138 and authorizes the EFS mandate based on the validation. In one implementation, the authorization module 128-2 sends an acknowledgement of the authorization to the first financial institution.
[0036] Once the EFS mandate is authorized, the execution module 130-2 of the RTS
system 102-2 executes the transaction(s), periodically, according to the particulars of the EFS mandate 138. For example, the execution module 130-2 executes the transaction on a predefined date of every month staring from the start date of the EFS mandate 138 till the end date of the EFS mandate 138 as specified in the EFS particulars. The execution of the transaction involves, pulling of the funds equivalent to the transaction amount specified in the EFS mandate 138 from an account of the account holder associated with the first financial institution 110, and crediting of the funds into the beneficiary account associated with the second financial institution 112. Both pulling and crediting of funds is performed by the execution module 130-2 in real-time. Further, the puling and crediting of the funds take place through the financial switch 106 over the financial network 108 for real-time settlement of the transaction(s).

[0037] In one implementation, the execution of the transaction may be approved or
rejected by the authorization module 128-1 of the RTS system 102-1. For example, when the
execution module 130-2 invokes the transaction on the predefined date, the transaction is routed
through the ATM switch 130-2 to the ATM switch 130-1 and is received by the authorization
module 128-1 of the RTS system 102-1. The authorization module 128-1 may approve or reject
the transaction based on referring checks, such as balance amount check, etc. In one example, the
authorization module 128-1 interacts with the banking system, such as CBS of the first financial
institution 110, and determines whether the sufficient funds are available in the account of the
account holder. Accordingly, the authorization module 130-1 approves or rejects the transaction.
[0038] Upon receiving approval of the transaction, the execution module 130-2 pulls the
funds equivalent to the transaction amount specified in the EFS mandate 138 from the account of the account holder associated with the first financial institution 110, and credits the funds into the beneficiary account associated with the second financial institution 112. As indicated previously, the pulling and crediting of funds is performed by the execution module 130-2 in real-time. Further, the puling and crediting of the funds take place through the financial switch 106 over the financial network 108 for real-time settlement of the transaction. In case the transaction is rejected, for example, because of lacks of funds in the beneficiary account or other reasons, the execution module 130-2 is configured to periodically re-poll or re-execute the rejected transaction at predefined intervals, say, three times. In one example, the execution module 130-2 can be configured to re-poll the rejected transaction at predefined intervals at a parameterized frequency, say, three times a day.
[0039] In an illustrative example, consider a scenario where a user has a salary account
associated with 'ABC financial institution and a housing loan account associated with 'XYZ' financial institution. In order to avail the EFS, the user may fill the particulars in the EFS mandate, such as name and address of the user; bank, branch, account details and MICR code, IFSC code or sort code of XYZ, start date and end date for initiating an EFS, transaction amount, etc., along with a cancel cheque to the 'ABC financial institution. The 'ABC financial institution may validate the received particulars and the signature in the cancel cheque and further upload the validated EFS mandate to the 'ABC financial institution switch. Therefore, the customer has now authorized the 'ABC financial institution to periodically debit funds of a particular transaction amount, on a predefined date, from the 'XYZ' financial institution. Further,

at the end of the day, the 'ABC financial institution switch may transfer all the received EFS mandates to the ATM switch of the destination institution, i.e-, in the present case, the 'XYZ; financial institution switch, through the financial switch over a financial network. The 'XYZ' financial institution may further download the received EFS mandates from the XYZ financial institution switch either automatically and further authorize the EFS mandates based on validating the particulars of the EFS mandate to the loan account details registered with the 'XYZ' financial institution. Upon validation, it may be implied that the user has authorized the 'XYZ' financial institution to periodically debit funds towards clearing the loan, from the salary account with 'ABC financial institution. Therefore, if a user has authorized the 'ABC financial institution to debit 20000 Rupees, on the 5th of every month, the 'XYZ: financial institution switch pulls the predefined funds on the predefined date, from the 'ABC financial institution switch, through the financial switch, thereby enabling real time settlement of funds. Now this arrangement can be executed at any time including non working day and time, thereby giving time value aspect to monies settlement.
[0040] However, under circumstances where the transaction is rejected by the first
financial institution 110, the ATM switch 104-2 may allow periodic re-polling of rejected
transactions. The re-polling may occur periodically at predefined intervals, for example, 3 times
in a day. The periodic re-polling allows for settlement of rejected transactions under
circumstances where transaction is rejected for a temporary reason, such as credit not being
available in the customers account for the specific instant of time or network error, etc.
[0041] Considering a scenario, where a customer has a salary account associated with
'ABC financial institution and a housing loan account associated with 'XYZ' financial institution. During execution of the transaction, the ATM switch of the 'XYZ' financial institution may pull funds from the 'ABC financial institution However, under circumstances where the 'ABC financial institution rejects such a transaction due to lack of funds, then in such a case, the ATM switch of the 'XYZ' financial institution may repeatedly re-poll, at predefined intervals, in order to facilitate settlement of transactions at the earliest. Therefore, if funds are not available in the customer's account till the salary gets credited to the account, the periodic re-polling may allow the customer to settle his transactions on the predefined date, thereby preventing the users from inadvertently becoming defaulters because of rejected transaction.

[0042] Further, if required, at a predefined time intervals, the financial institutions
participating in the EFS and may settle funds through the financial switch banking system 107 which may be a conventionally known settlement system. In said implementation, the financial switch banking system 107 may facilitate net settlement of transactions, at the predefined intervals, based on receipt of a settlement file from the respective financial institutions 110 and 112, participating in the interbank fund settlements.
(0043] Further, the described systems and methods of the present subject matter allow
modification or cancellation, of the EFS mandate 138 through a Graphical User Interface (GUI) of the ATM or a computing device. In one implementation, the computing device may include desktop computers, hand-held devices, laptops or other portable computers, advanced cellular phones, tablets, notebooks and the like. In such a case, the mandate receiving module 124-1 and 124-2 may receive the modified or cancelled EFS mandate 138 and appropriately, the EFS mandate stored in the EFS mandate data 134-1 and 134-2 of the ATM switches 104-1 and 104-2 of RTS system 102-1 and 102-2, respectively, will stand updated with the modified details For example, if a user wishes to have the transaction amount altered from 20.000 Rupees to 15,000 Rupees, the user may use an ATM to modify the EFS mandate 138. This may be achieved by inserting the ATM card at the ATM terminal and upon authentication, by means of finger press for biometric or PIN or any such equivalents, the user may access all the EFS mandates 138 registered under the user's name, thereby allowing the user to modify the EFS mandates 138 through a GUI of the ATM.
[0044] Thus, the described systems and methods of the present subject matter may allow
real-time settlement of transactions by utilizing the financial switch of the financial network.
Further, since the method involves interaction between the ATM switches or machines of the
financial institutions, through a financial switch, this method enables ECS and other allied
process like NEFT and RTGS to facilitate real-time settlement of transactions at any time of the
day, including non working days. Furthermore, since this method allows modification or
cancellation of the EFS mandate by utilizing the ATM or any other computing device as a
Graphical User Interface (GUI), thereby easing the process to an end customer.
[0045] Fig. 2 illustrates a method 200 for real-time settlement of transactions through a
financial switch, according to an implementation of the present subject matter. The order in which the method 200 is described is not intended to be construed as a limitation, and any

number of the described method blocks can be combined in any order to implement the method 200, or any alternative methods. Additionally, individual blocks may be deleted from the method 200 without departing from the spirit and scope of the subject matter described herein. Furthermore, the method 200 can be implemented in any suitable hardware platform(s).
[0046] The method 200 may be described in the general context of computer executable
instructions. Generally, computer executable instructions can include routines, programs, objects, components, data structures, procedures, modules, functions, etc., that perform particular functions or implement particular abstract data types. The method 200 may also be practiced in a distributed computing environment where functions are performed by remote processing devices that are linked through a communications network. In a distributed computing environment, computer executable instructions may be located in both local and remote computer storage media, including memory storage devices.
[0047] Further, although the method 200 may be implemented in any computing device;
in an example described in Figure 2, the method 200 is explained in context of the aforementioned device 202, for the ease of explanation.
[0048] Referring to Figure 2, at block 202, an Electronic Fund Settlement (EFS)
mandate corresponding to one or more transactions mediated through ECS, NEFT and RTGS respectively, is obtained by the first financial institution. In one implementation, the EFS mandate is obtained by the mandate receiving module 124-1 of the RTS system 102-1 associated with the first financial institution 110. In another implementation the EFS mandate 138 may include at a plurality of particulars, including but not limited to, account details including name, address and branch of an account holder, account details of a beneficiary account, details including Magnetic Ink Character Recognition (MICR) code, sort code and its equivalents, such as, Indian Financial System Code (IFSC) of a second financial institution associated with the beneficiary account. The particulars of the EFS mandate may further include a predefined date on which the transactions are to be performed or executed, a start date of the EFS mandate, an end date of the EFS mandate, transaction amount, and the like. Along with the EFS mandate 138, a cancel cheque may also be obtained from the account holder.
[0049] At block 204, the EFS mandate is stored in the Automated Teller Machine (ATM)
switch of the first financial institution in the format of an ATM data. In said implementation, the EFS mandate 138 is stored at the ATM switch 104-1 of the first financial institution 110 in a

manner analogous to storage of ATM card data at the ATM switch. The analogy may be better understood by mapping each particulars of the EFS mandate 138 to each corresponding datum of the ATM card. For example, the start date and end date in the EFS mandate can be mapped to the "from date" and "expiry date" displayed on the ATM card. In one implementation, the mandate receiving module 124 stores the EFS mandate into the ATM switch of the first financial institution in the format of an ATM card data. In one implementation, the mandate receiving module 124, in one example, uploads the EFS mandate into the ATM switch 104-1 of the first financial institution 110.
[0050] At block 206, the EFS mandate stored in the ATM switch of the first financial
institution is transmitted to the ATM switch of the second financial institution, where the
transmitting is routed through a financial switch over a financial network. In one
implementation, the financial network 108 may be an ATM network. Various communication
protocols, including ISO-8583 may be used, to facilitate the receipt and transmission of the EFS
mandate between the ATM switches 104-1 and 104-2 of the financial institutions 110 and 112,
over the financial network 108. In one implementation, the mandate transmission module 126 of
RTS 102-1 facilitates transmission of the EFS mandate from the ATM switches 104-1 of the first
financial institution 110 to the ATM switch 104-2 of the second financial institution 112.
[0051) Further, at block 208, the EFS mandate received by the ATM switch of the
second financial institution, is authorized by the second financial institution , for execution and
settlement of the transactions in real-time. In one implementation, the authorization of the EFS
mandate 138 is based on downloading the EFS mandate 138 to the banking system, such as Core
Banking Solutions (CBS) of the second financial institution 112, and further validating based on
comparing the particulars in the received EFS mandate 138 to the account details registered with
the second financial institution 112. In one implementation, the authorization module 128-2 of
the RTS system 102-2 authorizes the EFS mandate 138 based on the validation.
[0052] At block 210, the second financial institution may execute the one or more
transactions associated with the EFS mandate based on particulars of the EFS mandate after the authorization. In one implementation, the execution module 130-2 of the second financial institution 112 executes the transaction, periodically, based on the particulars of the EFS mandate 138. For example, the execution module 130-2 executes the transaction on a predefined date of every month staring from the start date of the EFS mandate till the end date of the EFS

mandate as specified in the EFS particulars. The execution of the transaction involves, pulling of the funds equivalent to the transaction amount specified in the EFS mandate 138 from an account of the account holder associated with the first financial institution 110. and crediting of the funds into the beneficiary account associated with the second financial institution 112. Both pulling and crediting of funds is performed by the execution module 130-2 in real-time. Further, the pulling and crediting of the funds take place through the financial switch 106 over the financial network 108 for real-time settlement of the transaction(s).
[0053] In one implementation, the execution of the transaction may be approved or
rejected by the authorization module 128-1 of the RTS system 102-1. The authorization module 128-1 may approve or reject the transaction based on referring checks, such as balance amount check, etc. In one example, the authorization module 128-1 interacts with the banking system, such as CBS of the first financial institution 110, and determines whether the sufficient funds are available in the account of the account holder. Accordingly, the authorization module 128-1 approves or rejects the transaction.
[0054] Upon receiving approval of the transaction, the execution module 130-2 pulls the
funds equivalent to the transaction amount specified in the EFS mandate 138 from the account of the account holder associated with the first financial institution 110, and credits the funds into the beneficiary account associated with the second financial institution 112. As indicated previously, the pulling and crediting of funds is performed by the execution module 130-2 in real-time. Further, the puling and crediting of the funds take place through the financial switch 106 over the financial network 108 for real-time settlement of the transaction. In case the transaction is rejected, for example, because of lacks of funds in the beneficiary account or other reasons, the execution module 130-2 is configured to periodically re-poll or re-execute the rejected transaction at predefined intervals, say, three times. In one example, the execution module 130-2 can be configured to re-poll the rejected transaction at predefined intervals at a parameterized frequency, say, three times a day.
[0055] Although implementations for methods and systems for real-time settlement of
transactions are described, it is to be understood that the present subject matter is not necessarily limited to the specific features or methods described. Rather, the specific features and methods are disclosed as implementations for real-time settlement of transactions

I/We claim:
1. A computer implemented method for real-time settlement of transactions, the method
comprising:
obtaining, from a first financial institution (110), an Electronic Fund Settlement (EFS) mandate (138) corresponding to at least one transaction, wherein the EFS mandate (138) is stored into an ATM switch (104-1) of the first financial institution (110);
transmitting the EFS mandate (138) to an ATM switch (104-2) of the second financial institution (112); and
receiving authorization, from the second financial institution (112), for execution of the at least one transaction according to the particulars of the EFS mandate (138), wherein the authorization allows the at least one transaction to be executed and settled in real-time.
2. The method as claimed in claim 1, wherein the EFS mandate (138) contains particulars including at least account details of an account holder associated with a first financial institution (110), account details of at least one beneficiary account associated with a second financial institution (112), a predefined date of execution of the at least one transaction, a start date of the EFS mandate, an end date of the EFS mandate, and a transaction amount.
3. The method as claimed in claim 1, wherein the execution comprises:
obtaining, from the first financial institution (110), approval of the execution of the at least one transaction;
pulling funds equivalent to a transaction amount specified in the particulars of the EFS mandate (138) from an account of the account holder specified in the particulars of the EFS mandate (138), wherein the account is associated with the first financial institution (110); and
crediting the funds into at least one beneficiary account specified in the particulars of the EFS mandate (138) wherein the at least one beneficiary account is associated with the second financial institution (112), and wherein the obtaining, the pulling and the crediting is performed, periodically, and in real-time on a predefined date from the start date till the end date specified in the particulars of the EFS mandate (138).

4. The method as claimed in claim 1, wherein the execution comprises:
obtaining, from the first financial institution (110), rejection of the execution of the at least one transaction;
re-polling the at least one transaction for predefined time intervals; wherein the re-polling attempts to pull funds equivalent to the transaction amount from an account of an account holder specified in the particulars of the EFS mandate (138); and
crediting the funds into at least one beneficiary account specified in the particulars of the EFS mandate (138) upon successful re-polling.
5. The method as claimed in claim 1, wherein the EFS mandate (138) is stored into the ATM switch (104-1) in a format analogous to a format of an ATM card data.
6. The method as claimed in claim 1, wherein the execution of the at least one transaction is routed through a financial switch (106) over a financial network (108).
7. The method as claimed in claim 4, wherein the financial switch (106) is an ATM switch and the financial network (108) is an ATM network.
8. The method as claimed in claim 1 further comprises modifying the EFS mandate (138) based on receiving modification instructions from an account holder through one of an ATM and a computing device.
9. The method as claimed in claim 1, wherein the at least one transaction include a transaction mediated through one of an Electronic Clearing Service (ECS), National Electronic Fund Transfer (NEFT) and Real Time Gross Settlement (RTGS).
10. The method as claimed in claim 1, wherein the authorization comprises validating the EFS mandate (138) based on comparison of the particulars of the EFS mandate (138) to registered account details of an account holder.
11. A Real Time Settlement (RTS) System (102-2) for real-time settlement of transactions between a first financial institution (110) and a second financial institution (112), the RTS system (102-2) comprising:
a processor (114-2); and
an execution module (130-2) coupled to the processor (114-2) to execute at least one transaction associated with a EFS mandate (138) according to particulars of the EFS mandate (138), wherein the particulars of the EFS mandate (138) includes at least account details of an account holder associated with the first financial institution (110),

account details of at least one beneficiary account associated with the second financial institution (112), a predefined date of execution of the at least one transaction, a start date of the EFS mandate, an end date of the EFS mandate, and a transaction amount, wherein the execution includes:
obtaining, from the first financial institution (110), approval for the execution of the at least one transaction;
pulling funds equivalent to the transaction amount from an account of the account holder associated with the first financial institution (110); and
crediting the funds into the at least one beneficiary account associated with the second financial institution (112), and wherein the obtaining, the pulling and the crediting is performed, periodically, and in real-time on the predefined date from the start date till the end date specified in the particulars of the EFS mandate (138).
12. The RTS system (102-2) as claimed in claim 11, wherein the execution module (130-2) performs periodic re-polling of the at least one transaction rejected by the first financial institution (110), wherein the re-polling is performed at predefined intervals.
13. The RTS system (102-2) as claimed in claim 12, wherein the re-polling is performed further at a parameterized frequency.
14. The RTS system (102-2) as claimed in claim 11, further comprises an authorization module (128-2) coupled to the processor (114-2) to authorize the at least one transaction for execution and settlement in real-time.
15. A non-transitory computer-readable medium having embodied thereon a computer program for executing a method comprising:
obtaining, from a first financial institution (110), an Electronic Fund Settlement (EFS) mandate (138) corresponding to at least one transaction, wherein the EFS mandate (138) is stored into an ATM switch (104-1) of the first financial institution (110);
transmitting the EFS mandate (138) to an ATM switch (104-2) of a second financial institution (112); and

receiving authorization, from the second financial institution (112). for execution of the at least one transaction according to the particulars of the EFS mandate, wherein the authorization allows the at least one transaction to be executed and settled in real-time.