Here’s some good news for you: transferring money to the wrong bank account may soon be a thing of the past! The Reserve Bank of India (RBI) has announced a new initiative to introduce a beneficiary account name lookup facility for the Real Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT) systems.
This facility will enable users to verify the beneficiary’s name before completing a transaction. It aims to significantly reduce the number of incorrect or fraudulent transfers.
A Welcome Change
Currently, the Unified Payments Interface (UPI) and Immediate Payment Service (IMPS) systems already provide this feature. They allow users to confirm the recipient’s name before making payments. On 30 December, the RBI stated, “Currently, the Unified Payments Interface (UPI) and Immediate Payments Service (IMPS) systems enable a remitter to verify the name of the beneficiary before initiating transfer.”
Now, RTGS and NEFT users will also get the same advantage.
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Adhil Shetty, CEO of Bankbazaar.com, says, “The beneficiary account name look-up facility is going to be a game-changer for customers using RTGS and NEFT. RBI has done an outstanding job by introducing this initiative. It allows remitters to confirm the account holder’s name before transferring money. This simple step will help prevent errors caused by incorrect account details. It will also act as a safeguard against fraudulent transactions. Customers can verify the beneficiary’s name based on the account number and IFSC entered. If the name cannot be displayed, they can decide whether to proceed with the transfer or not.”
“By making this feature available via internet banking, mobile banking, and even at branches, banks will ensure a uniform and seamless experience for all users. This initiative strengthens digital banking and makes it safer and more reliable for customers,” Shetty explains.
How It Works
The National Payments Corporation of India (NPCI) has been tasked with developing this new facility. Banks will integrate it into their internet banking and mobile banking platforms. It will also be available to customers making transactions in bank branches.
When using RTGS or NEFT, customers will input the beneficiary’s account number and the branch’s IFSC code. The system will then display the beneficiary’s name,
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