Section 24 of The Payment and Settlement Systems Act, 2007
- (1)The system provider shall make provision in its rules or regulations for creation of panel consisting of not less than three system participants other than the system participants who are parties to the dispute to decide the disputes between system participants in respect of any matter connected with the operation of the payment system.
- (2)Where any dispute in respect of any matter connected with the operation of the payment system arises between two or more system participants, the system provider shall refer the dispute to the panel referred to in sub-section (1).
- (3)Where any dispute arises between any system participant and the system provider or between system providers or where any of the system participants is not satisfied with the decision of the panel referred to in sub-section (1), the dispute shall be referred to the Reserve Bank.
- (4)The dispute referred to the Reserve Bank for adjudication under sub-section (3) shall be disposed of by an officer of the Reserve Bank generally or specially authorised in this behalf and the decision of the Reserve Bank shall be final and binding.
- (5)Where a dispute arises between the Reserve Bank, while acting in its capacity as system provider or as system participant, and another system provider or system participant, the matter shall be referred to the Central Government which may authorise an officer not below the rank of Joint Secretary for settlement of the dispute and the decision of such officer shall be final.
Summary
- Every system provider must have rules to create a panel for deciding disputes between participants.
- The panel must have at least three system participants who are not involved in the dispute.
- If the dispute involves the system provider itself, it must be referred to the Reserve Bank.
- If a participant is unhappy with the panel's decision, they can appeal to the Reserve Bank.
- The Reserve Bank's decision on such disputes is final and binding.
- If the Reserve Bank is a party to the dispute, the Central Government settles the matter.
Practical examples
FAQ
1. How many members must be on the dispute panel?
The panel must consist of not less than three system participants.
2. Can a bank on the panel be part of the actual dispute?
No, the members must be participants other than the ones who are parties to the dispute.
3. What happens if I don't like the Reserve Bank's decision?
The law states that the decision of the Reserve Bank in these matters is final and binding.
4. Who handles disputes if the Reserve Bank itself is running the payment system?
In that case, the dispute is referred to the Central Government.
Test yourself
Q1.Under Section 24 of The Payment and Settlement Systems Act, 2007, who is responsible for creating a panel to decide disputes between system participants?
Q2.According to Section 24 of The Payment and Settlement Systems Act, 2007, where is a dispute referred if it arises between two different system providers?
Q3.Under Section 24 of The Payment and Settlement Systems Act, 2007, who handles a dispute if the Reserve Bank is acting as a system participant?
Q4.Under Section 24 of The Payment and Settlement Systems Act, 2007, what is the minimum number of participants required on a dispute resolution panel?