rbi-mandates-name-look-up-for-rtgs-neft-by-april-2025

The Reserve Bank of India (RBI) has directed banks offering Real Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT) services to implement a beneficiary account name look-up facility for customers making fund transfers by 1st April 2025. 

 

Banks participating in the RTGS and NEFT systems must provide this facility through internet banking, mobile banking, and at physical branches for customers conducting in-person transactions.

 

 This move aims to enhance the security and reliability of digital fund transfers. The RBI stated, "All banks who are direct members or sub-members of RTGS and NEFT are advised to offer this facility no later than 1st April 2025."

 

In an official notification issued late on Monday, the central bank noted that existing payment systems such as the Unified Payments Interface (UPI) and Immediate Payments Service (IMPS) allow remitters to verify the name of the beneficiary before initiating a transfer.

 

 Recognising the benefits of this feature, the RBI has decided to implement a similar mechanism for RTGS and NEFT. This facility will enable individuals initiating transactions through RTGS or NEFT to confirm the beneficiary's account name before transferring funds.

 

The RBI had first proposed this initiative on 9th October 2024, highlighting its importance in reducing errors and ensuring accurate fund transfers. To support the system, the RBI has instructed the National Payments Corporation of India (NPCI) to develop the necessary infrastructure and ensure that all banks are onboarded.

 

 The RBI stated, "The National Payments Corporation of India (NPCI) has been advised to develop the facility and onboard all banks."

 

The RBI has mandated that all banks, whether direct or sub-members of the RTGS and NEFT systems, must make this service available to their customers by the April 2025 deadline. This initiative is expected to significantly enhance customer convenience and trust in digital banking. 

 

By allowing users to verify the recipient's account name in advance, the RBI aims to minimise transaction errors and improve the overall efficiency of electronic payment systems in India.