Mumbai: The Reserve Bank of India (RBI) on Monday directed all banks to put in place a facility to enable a remitter to verify the beneficiary bank account name before initiating a transaction using the RTGS or NEFT system.
“All banks who are direct members or sub-members of RTGS and NEFT are advised to offer this facility no later than April 1, 2025,” the RBI circular states.
With the introduction of this facility, remitters can input the account number and the branch IFSC code of the beneficiary, following which the name of the beneficiary will be displayed.
This facility will increase customer confidence as it would reduce the possibility of wrong credits and frauds.
The introduction of a beneficiary bank account name look-up facility for Real Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT) Systems was proposed in the RBI’s Statement on Developmental and Regulatory Policies dated October 9, 2024.
Currently, the Unified Payments Interface (UPI) and Immediate Payments Service (IMPS) systems enable a remitter to verify the name of the beneficiary before initiating the transfer.
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. Accordingly, National Payments Corporation of India (NPCI) has been advised to develop the facility and onboard all banks, the RBI has stated in its circular to all banks.
The RBI has directed that banks which are participants of RTGS and NEFT Systems, shall make this facility available to their customers through Internet banking and Mobile banking.
The facility shall also be available to remitters visiting branches for making transactions. Detailed requirements for the same have been provided to the banks.
The RBI has taken the decision as there have been requests to introduce such a facility for Real Time Gross Settlement System (RTGS) and National Electronic Funds Transfer (NEFT) systems on the same lines as payment systems like UPI and IMPS.
Accordingly, to enable remitters in RTGS and NEFT to verify the name of the beneficiary account holder before initiating funds transfer, it is now proposed to introduce a ‘beneficiary account name look-up facility,” the RBI had stated in its statement in October.
It had also said that an order to introduce the facility will be issued separately.
–IANS