The Reserve Bank of India (RBI) has instructed the National Payments Corporation of India (NPCI) to develop a system allowing users of NEFT (National Electronic Funds Transfer) and RTGS (Real-Time Gross Settlement) to verify the name of the recipient’s bank account before transferring funds. This measure aims to reduce errors and prevent fraud during online transactions.
All banks participating in RTGS and NEFT, whether as direct or sub-members, must offer this facility to customers by April 1, 2025. The verification system will be accessible through internet banking, mobile banking, and branch visits.
The system will retrieve the beneficiary’s account name from the bank’s Core Banking Solution (CBS) based on the account number and IFSC provided by the sender. The recipient’s name will be displayed to the sender before completing the transfer. If the name cannot be fetched for any reason, the sender can choose to proceed at their discretion.
The NPCI will not store any data related to this facility. In case of disputes, the sending and receiving banks will resolve the issue using unique reference numbers and transaction logs.
The RBI has mandated that this account name verification service be provided to customers free of charge, ensuring greater convenience and safety in fund transfers.
By implementing this feature, the RBI aims to enhance transparency and build trust in digital payment systems.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
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