RTGS, NEFT transactions get safer with this new RBI feature
The Reserve Bank of India (RBI) has announced that it will launch a name look-up facility for Real Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT) systems by April 1, 2025. The new feature will allow users to confirm the beneficiary's name before proceeding with any transaction. The move is aimed at minimizing errors and potential fraud in financial transactions.
NPCI to develop and implement verification feature
The RBI has tasked the National Payments Corporation of India (NPCI) with creating and implementing this verification feature. The facility would fetch the beneficiary's account name from the bank's Core Banking Solution (CBS), using the account number and IFSC entered by the sender. Once it goes live, it will be available across all banks participating in RTGS and NEFT systems.
Verification feature to be available across multiple platforms
The verification feature will be accessible to customers via internet banking, mobile banking platforms, and bank branches. All banks who are direct members or sub-members of RTGS and NEFT systems must provide this facility by the April 1, 2025 deadline. This move comes as part of RBI's continuous efforts to improve the digital payment ecosystem in India.
Delhi HC urges swift implementation to prevent cyber frauds
The Delhi High Court has urged the RBI to fast-track the implementation of a system that verifies the beneficiary's name for RTGS and NEFT transactions. Justice Pratibha M Singh stressed that such a system is imperative to prevent cyber frauds, warning that delays could affect thousands of consumers unknowingly making payments to fraudulent beneficiaries. The court also ordered that this system be implemented across all banks.
RBI issues instructions for uniform customer experience
The RBI has given specific instructions to banks for a uniform customer experience. These include offering the verification feature in internet and mobile banking facilities at the time of beneficiary registration and one-time fund transfers. Banks are also mandated to provide a re-verification option for registered beneficiaries anytime, and show the beneficiary account name given by the beneficiary bank to the sender.
