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10. FINACLE KASTLE INTERFACE Treasury processes all its transactions in a package called KASTLE.

. B Category branches will process their Trade Finance transactions in FINACLE in a multicurrency environment. Exchange rates given by Treasury through KASTLE will be applied by branches in FINACLE. The main purpose of this interface is to ensure that the exchange rates applied to transactions are identical in both the systems i.e. KASTLE and FINACLE. There will be no manual input of exchange rates in FINACLE. B category branches that need an exchange to apply to a Trade Finance transaction will send a fax to Treasury and obtain a rate by return fax from Treasury. This rate will have a reference number attached to it called the Cryptic deal rate. Only brief details are noted and input by Treasury into KASTLE while giving the cryptic deal rate. The rate will be utilized by the concerned branch before the end of the day. If the cryptic deal is not utilized by the branch, Treasury will cancel the deal and the loss if any on the cancellation of the cryptic deal will be to the branch account. Card rates are input by Treasury into KASTLE and will be uploaded every day in the morning to FINACLE. Card rates can be applied to a transaction of value upto USD 5000 or equivalent in other currencies. Transactions of value USD 5000 and above or equivalent in other currencies will need a cryptic deal. The same rules now apply for application of transaction rates through the interface: 1. Transactions upto USD 5000 or equivalent in other currencies either card rate (which is defaulted in FINACLE) or a cryptic deal has to be taken from Treasury if the rate needs to be better than the card rate. 2. Transactions of the value of USD 5000 and above or equivalent in other currencies cryptic deal is mandatory. Once the cryptic deal is given by Treasury to the branch, Treasury enters the deal details into KASTLE. On authorization in KASTLE, the data will flow into FINACLE and will be available to the B category branch as a drop down and can be selected for application to a transaction. The cryptic deal is customer and transaction specific. B category branches must give the list of customer_ids of all its Trade Finance customers to Treasury immediately on migration to CBS and thereafter whenever they open a new customer_id in FINACLE. It will be the responsibility of the branch to ensure that it selects the correct cryptic deal while doing the transaction. The cryptic deal can be used only for the customer for whom the rate has been obtained and only for the particular transaction type i.e. if the rate is taken for customer A, the rate can be used for that customers transactions only. If the rate is taken for purchase of bills, it can be used only for FBP and not for any other type such as merchant forward contract. A single cryptic deal can be utilized in part for one or more transactions of the same type of the same customer. At the end of the day, the unutilized portion of the cryptic deal must not exceed USD 1000 or equivalent in other currencies. Treasury will cancel such unutilized portion at the end of the day without waiting for any confirmation from branches.

As mentioned earlier, if the unutilized portion is above USD 1000 or equivalent in other currencies, Treasury will cancel the cryptic deal and debit loss if any on account of such cancellation to the branch. If for any reason, branch is not able to view cryptic deal, Treasury will cancel and re-input a fresh cryptic deal in KASTLE. No exchange rate application will be done outside this arrangement. The following screen shots will show where in FINACLE Trade Finance module, the cryptic deal is to be captured. Forward Contract (Cryptic Deal is required in time of booking)

Press F2 at the place mentioned above. The drop down screen appears (see the screen below). Select the rate through Shift+F4 and press F4.

Capturing Cryptic Deal for FBP/FBN/EBRD type Bill during lodgment (Cryptic Rate is required in time of P (purchase) option)

Note: If any forward contract exists for the bill, then cryptic rate is not required because at the time of booking contract rate was taken. User should put contract id here i.e. just below USD put Branch id and below 50000 put contract id. User may select the required contract id by F2 there.

Capturing Cryptic Deal for FBC (collection) bill

If there is any contract against the bill, same contract no should be put in the respective field as shown above. Then cryptic deal is not required.

Cryptic deal for FCNRB deposit and PCFC (FCNRB) Loan (Cryptic Deal is required during funding/ disbursement / Repayment of loan) Generally FCNRB deposits are made by i) debiting customers NRE a/c, ii) remittance received from abroad in FCY and iii) cross-currency conversion transactions i.e. remittance received in a currency other than that of the proposed deposit. The following example gives the opening of USD deposit against INR. Menu option: TM Function: A. Press F4 Put T /CI in transaction type/sub type. Press F4 Put FCNRB deposit a/c id in a/c id field. Press F4 Put amount of Deposit. Press F4. Put C (Credit) in the next field. Put particulars in the respective field, if required. Press F4 to go to next leg. Here put the a/c id from where the amount of FCNRB will be taken (This will be either in INR or a currency other than the currency of the proposed deposit). Press F4 In the amount field PRESS F2. Small box will appear in the bottom part of the screen. Here, remove INR and put actual currency. In the next field put actual USD amount. Then go to rate field and PRESS F2 to get the CRYPTIC RATE. Select the same and finally Press F4. Corresponding INR value will be populated in the amount field. Please follow the Screen Shot below.

Cryptic Deal for disbursement of Foreign Currency Loan Foreign Currency Loan a/c is to be opened through Menu option HOAACLA with Scheme Code LAFCL After opening the a/c disbursement is to be done through Menu LADISB Function D for disbursement. Please follow the screen shot below: Put T in transaction Type field and disbursed FCY in disbursement field Put Customers Current a/c where the amount will be credited. Then press F4 and then F3. A small popup box will appear. This is known as Rate Code page. Repayment of loan to done by Menu Option: LAUPAY/LASPAY/ PAYOFF Press F2 in the rate field to get the Cryptic Deal drop down screen. Select the required Rate and press F4

Capturing Cryptic Deal for IRM AND ORM transactions (Cryptic deal is required during Realisation Event)

In Inward Remittance and Outward Remittance transaction, during Realisation process Cryptic Deal Rate is required if the amount is equivalent to USD 5000 or more. So Branch should ask for rate from the Treasury Branch through Deal Slip. In Realisation process cryptic rate is to be captured in the transaction screen as in the Screen Shot given below:

Select the appropriate rate by Shift+F4 and press F4 S (sale rate) will have to be selected for ORM. Sale of Foreign DD/ TC against payment by cash (INR) Foreign DD/TC can be sold against cash upto INR 50000 through ORM Here Operative a/c will be Teller Cash a/c/ Cash In Hand a/c and customer id will be Non Cust Id.All other procedures are same. The transaction screen Trans Type/ sub type should be C/Cr.

Press F4 to go to the next screen

Some problems faced by Branches regarding use of contract in collection type of bill

Suppose the branch has received collection proceeds of USD 24800 against a collection bill for USD25000 and the customer has already booked forward purchase contract for USD 70000 and wants to utilise the contract for the above bill. It is observed very often that after utilizing the contract, remaining contract value is USD 45000 instead of USD 45200. This type of mistake is done due to handling of transaction screen wrongly. In the Realisation Event short fall amount should be shown as foreign Bank charge. Press F4 to go to next page.

By following the above procedure forward contract value will reduce by only actual realisation value i.e. USD 24800. If there is no contract for the bill, then Cryptic Deal Rate, is required. Press F4. Please note that for every short fall realisation, above procedure is to be followed. User must put same rate for the above three (3) transactions. Problem 2: Bill is for USD 25000. Realisation Value is USD 24900 and there is a Forward Purchase Contract for USD 15000. In the above case, the same procedure is to be followed. Contract no. is to be given in respective place. In the last transaction put difference amount i.e. (24900-15000) = USD 9900. As the amount is greater than USD 5000, Cryptic rate is required. Branch should seek rate for USD 9900 for this type of transaction. User should press F2 on P to capture cryptic deal as usual. Utilization of Cross Currency forward contract in FINACLE A cross currency contract can be booked as usual through a cryptic deal. However, KASTLE does not store a cross currency forward contracts as a cross currency pair. Hence at the time of utilisation, a work around was suggested. The cross currency forward contract utilization can be handled in FINACLE by storing the utilization amount of the contract in EEFC/Any Other account in the same currency as the contract by the branch. After this, the amount stored in that foreign currency can be converted into INR at a rate provided by Treasury through a cryptic deal on the same day. This is diagrammatically shown below:

Menu Option:

In FBM menu option, in purchase event this approach can be incorporated. The screenshot of such a case in UAT is shown below:

Here, the GBP to USD conversion is taking place at contract rate and amount is going to a USD account. And from USD account it goes to an INR account at the rate supplied by Treasury Branch through Cryptic deal. Suppose the branch has received collection proceeds of USD 10800 against a collection bill for USD11000 and the customer has already booked forward purchase contract for GBP 11000 and wants to utilise the contract for the above bill. It is observed very often that after utilizing the contract, remaining contract value is GBP 5500 instead of GBP 5600. This type of mistake is done due to handling of transaction screen wrongly. In the Realisation Event short fall amount should be shown as foreign Bank charge as explained in a normal forward contract.

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