When you transfer to the wrong account :: Business Line

Please Share::

�� India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details ��

��

-->

It’s not as simple as asking your bank to reverse the transaction

Your salary’s in, and you set about transferring some money online to your parents. You owe your friend money or want to make a hotel reservation and choose the NEFT (National Electronic Funds Transfer) route.

Once you punch in the required numbers and hit the final confirm button, the amount is transferred seamlessly through NEFT. But horror! If you inadvertently typed in the wrong account number or put in the wrong IFSC code of the bank branch in which your recipient’s account is held, it will land in someone else’s account. What now? You can just ask the bank to reverse the transaction, right?

Sorry, no! That cannot be done. What’s worse, the ‘wrong beneficiary’ is not obliged to return your money.

What to do

So, here’s what you have to do. First, the legal position. The Reserve Bank of India has clearly indicated that the transfer of funds electronically depends entirely on the account number. Unfortunately, the beneficiary’s name has little relevance in the online transfer process. The trouble with wrong beneficiary names arises later. Now, you can be confronted with three different situations.

One, if you punch in an account number which does not exist, the amount will automatically come back to your account. In case of any delay, your bank branch can help quicken the process.

The second situation is if you type in the wrong account number and the (unintended) beneficiary’s name is different from the one you actually wanted the amount to be credited to. Approach your bank branch and prove to them that the beneficiary’s name is different. The bank will then contact the other account holder and ask for the amount to be returned as there is strong evidence of erroneous transfer.

The third situation arises when you type the wrong account number and that (unintended) account belongs to a person with the same name as the intended beneficiary. In this case, it is a tedious process as you will have to prove the transfer itself to be wrong.

Note that the bank is not allowed to automatically take that amount away, even if it is a case of incorrect transfer. Barring the first case, in the other two situations, your bank can only play the role of a facilitator.

The situation becomes increasingly complicated if your bank and your beneficiary’s banks are different, and/or are in different cities, and so on.

Your bank can help by giving the contact details of the accidental beneficiary’s bank and help you connect with the branch manager.

But you will have to do all the work in requesting reversal of transaction. This can include you having to personally request the unintended beneficiary to transfer the money back to you.

In case the IFSC code is wrong, then too, you and your beneficiary will have to coordinate between multiple banks to settle the issue.

Easy precautions

Banks normally ask you to type the account number twice; if you happen to commit a mistake in typing, the mismatch in the two numbers will not allow you to proceed further. So, there’s your first level of precaution.

Then, if the IFSC code is correct, it will ensure that the intended bank and branch are at least coordinated. If you want to transfer a large sum of money online, you can do a ‘test’ transfer.

So, first transfer a small amount of, say, ₹50 and check with the beneficiary if the amount has been received. Once you receive a confirmation, you can then safely transfer the rest.

And the simplest of rules to follow goes without saying. Double check the digits after typing!