law: Payment and Settlement Systems Act, 2007
  2. Definitions.-
  1.  
  
    In
  
  this Act, unless the context otherwise requires,-
  a.  
  
    "bank"
  
  means,-
   
  
   i.  
  
    a
  
  bank included in the Second Schedule to the Reserve Bank of India Act, 1934;
   
  
   ii.  
  
    a
  
  post office savings bank;
   
  
   iii.  
  
    a
  
  banking company as defined in clause (c) of section 5 of the Banking Regulation
  
  Act, 1949;
   
  
   iv.  
  
    a
  
  co-operative bank as defined in clause (cci) of section 5, as inserted by
  
  section 56, of the Banking Regulation Act, 1949; and
   
  
   v.  
  
    such
  
  other bank as the Reserve Bank may, by notification, specify for the purposes
  
  of this Act;
  a.  
  b.  
  
    "derivative"
  
  means an instrument, to be settled at a future date, whose value is derived
  
  from change in interest rate, foreign exchange rate, credit rating or credit
  
  index, price of securities (also called "underlying"), or any other
  
  underlying or a combination of more than one of them and includes interest rate
  
  swaps, forward rate agreements, foreign currency swaps, foreign currency rupee
  
  swaps, foreign currency options, foreign currency rupee options or any other
  
  instrument, as may be specified by the Reserve Bank from time to time;
  c.  
  
    "electronic
  
  funds transfer" means any transfer of funds which is initiated by a person
  
  by way of instruction, authorisation or order to a bank to debit or credit an
  
  account maintained with that bank through electronic means and includes point
  
  of sale transfers, automated teller machine transactions, direct deposits or
  
  withdrawal of funds, transfers initiated by telephone, internet and card
  
  payment;
  d.  
  
    "gross
  
  settlement system" means a payment system in which each settlement of
  
  funds or securities occurs on the basis of separate or individual instructions;
  
  
  e.  
  
    "netting"
  
  means the determination by the system provider of the amount of money or
  
  securities, due or payable or deliverable, as a result of setting off or
  
  adjusting, the payment obligations or delivery obligations among the system
  
  participants, including the claims and obligations arising out of the
  
  termination by the system provider, on the insolvency or dissolution or winding
  
  up of any system participant or such other circumstances as the system provider
  
  may specify in its rules or regulations or bye-laws (by whatever name called),
  
  of the transactions admitted for settlement at a future date so that only a net
  
  claim be demanded or a net obligation be owned;
  f.  
  
    "notification"
  
  means a notification published in the Official Gazette;
  g.  
  
    "payment
  
  instruction" means any instrument, authorisation or order in any form,
  
  including electronic means, to effect a payment,- (i) by a person to a system
  
  participant; or (ii) by a system participant to another system participant;
  h.  
  
    "payment
  
  obligation" means an indebtedness that is owned by one system participant
  
  to another system participant as a result of clearing or settlement of one or
  
  more payment instructions relating to funds, securities or foreign exchange or
  
  derivatives or other transactions;
  i.  
  
    "payment
  
  system" means a system that enables payment to be effected between a payer
  
  and a beneficiary, involving clearing, payment or settlement service or all of
  
  them, but does not include a stock exchange;
  Explanation.- For the purposes of this
  
  clause, "payment system" includes the systems enabling credit card
  
  operations, debit card operations, smart card operations, money transfer operations
  
  or similar operations;
  a.  
  
  
  b.  
  
  
  c.  
  
  
  d.  
  
  
  e.  
  
  
  f.  
  
  
  g.  
  
  
  h.  
  
  
  i.  
  
  
  j.  
  
    "prescribed"
  
  means prescribed by regulations made under this Act;
  k.  
  
    "regulation"
  
  means a regulation made under this Act;
  l.  
  
    "Reserve
  
  Bank" means the Reserve Bank of India, constituted under the Reserve Bank
  
  of India Act, 1934;
  m.  
  
    "securities"
  
  means the Government securities as defined in the Public Debt Act, 1944 or such
  
  other securities as may be notified by the Central Government from time to time
  
  under that Act;
  n.  
  
    "settlement"
  
  means settlement of payment instructions and includes the settlement of
  
  securities, foreign exchange or derivatives or other transactions which involve
  
  payment obligations;
  o.  
  
    "systemic
  
  risk" means the risk arising from- (i) the inability of a system
  
  participant to meet his payment obligations under the payment system as and
  
  when they become due; or (ii) any disruption in the system, which may cause
  
  other participants to fail to meet their obligations when due and is likely to
  
  have an impact on the stability of the system: Provided that if any doubt or
  
  difference arises as to whether a particular risk is likely to have an impact
  
  on the stability of the system, the decision of the Reserve Bank shall be
  
  final;
  p.  
  
    "system
  
  participant" means a bank or any other person participating in a payment
  
  system and includes the system provider;
  q.  
  
    "system
  
  provider" means a person who operates an authorised payment system.
  1.  
  
  
  2.  
  
    Words
  
  and expressions used, but not defined in this Act and defined in the Reserve
  
  Bank of India Act, 1934 or the Banking Regulation Act, 1949, shall have the
  
  meanings respectively assigned to them in those Acts.