Mumbai: The Reserve Bank of India (RBI) has once again stepped in on the consumer’s side to ask the National Payments Corporation of India (NPCI) to develop a function which allows customers to verify the name of the bank account to which they plan to transfer money before the actual transaction is made via NEFT and RTGS.
This is expected to prevent any mistake that arise out of mistakenly entered account details and wrongful transfer into a bank account. The RBi has set an April 1, 2025, deadline for banks that conform to Real Time Gross Settlement (RTGS) System and National Electronic Funds Transfer (NEFT) systems to offer this facility, according to an official circular.
Facilities for verified money transfer
The RBI and NPCI offer bank account name verification facilities for transactions carried out via the Unified Payments Interface (UPI) and the Immediate Payments Service (IMPS). “It has been decided to put in place a similar facility that would enable a remitter to verify the beneficiary bank account name before initiating a transaction using RTGS or NEFT system,” it said.
RBI introduces Beneficiary Name Look-Up for RTGS & NEFT!
From 1st April 2025, banks must enable remitters to verify beneficiary account names before initiating transactions, similar to UPI/IMPS.
A big step for enhancing accuracy and reducing fraud!#RBI pic.twitter.com/TQdJh4q3Js
— Ajay Gupta (@ajayguptaca) December 30, 2024
The NPCI has been tasked with developing a similar system for RTGS and NEFT, before ensuring that al, banks are on board with this facility, according to the RBI circular. Banks are required to make this facility available to customers via mobile and Internet banking. Branch-based remittances will also carry this functionality for the customer’s benefit.
How bank account name verification will work
The facility for identifying the payee’s bank account name is being implemented, the RBI said in its circular. The beneficiary’s name will be fetched using their details based on the IFSC code and account number from the bank’s Core Banking Solution. These details will be showed to the customer before the transaction is carried out. “In case the beneficiary name cannot be displayed for any reason, the remitter can proceed with the fund transfer, at her discretion,” RBI said.
This facility will be available free of charge and any dispute arising out of the transfer will be between the remitter’s bank and the beneficiary’s bank. NPCI will not keep any record related to this facility, RBI said.
In a major relief for banking customers, the Reserve Bank of India has asked the National Payments Corp of India to develop a functionality which allows users to view the name of the person or entity to whom they are transferring money. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
