Account number portability between Banks – a possibilty
SS Mundra, Deputy Governor of the Reserve Bank of India has asked banks to positively assess customer account portability - thereby allowing customers to move seamlessly between banks without having to change their account numbers
SS Mundra, Deputy Governor of the Reserve Bank of India has asked banks to positively assess customer account portability – thereby allowing customers to move seamlessly between banks without having to change their account numbers.
During his interaction, he also said that the RBI is working on guidelines related to consumer protection, that would limit their liability in cases of fraud related to online / electronic banking. Defining such guidelines will give a positive signal in the market thereby allowing account holders to look at electronic banking as a much feasible medium of transactions. In August last year, the RBI has issued a draft circular, limiting the customer liability to Rs 5000 in case of online fraud, ony if the fraud was reported within 5-7 hours. If the time limit is not adhered to, then the Banks policy in such cases will take precedence. The new guidelines are expected soon.
Supporting the concept of future account number portability, the RBI Dy Gov said that it has been made easier to move towards account number portability, due to technological innovations linking Aadhaar ID issued by the Unique Identity Authority of India. He was speaking at an even organized by the Banking Codes and Standards Board of India. He also put forward a caveat for the banks, against charging higher service rates.
Urging the Indian Bank Association to start working on the concept sooner than later, he said that payment system enhancements, UPI, enrollment under Aadhaar and linkage of Aadhaar IDs to account numbers has got account number portability under a realm of possibility. An aggrieved customer can look at moving from one bank to another in absence of services, with this model coming into play.
The concept of account number portability is not present anywhere in the world, but mobile number portability has been in place for some time now in India and the IRDA is also looking at policy portability wherein a customer might transfer his policy from one insurer to another without having to surrender the policy.
Bankers, however are apprehensive of the concept, saying that moving account would mean large amount of complex changes to accounting databases in the core banking environment – something that is doable, but will take its own time and or course, money.
Senior bankers say that uniformity in account numbers is a must for account number portability. Currently account number digits also vary from bank to bank – HDFC has 14, ICICI has 12 and Citi has 10. They also said that mapping databases of banks, consolidation and processing make this a difficult task without any benefit. Public sector banks will anyways be vary, as their level of services is right down there as compared to private banks or local cooperative banks.
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