Post digitization, we have been showered with multiple payment options to transfer and receive money. Though these channels are secure and fast to send money across the globe. But human errors are not predictable and mistakes may happen.

Apart from UPI, for most other payment gateways you have to manually enter recipient details such as account number, IFSC and account holder’s name. In some situations, it is possible to enter wrong credentials while transferring money from one account to another bank account. If something like this happens, you may have questions, ‘what should I do now? Will it be possible to retrieve the transferred money?’

What is the RBI saying?

As per the RBI’s guidelines, it is the responsibility of the remitter to share valid and correct beneficiary details while transferring funds.

Though it is mandatory to mention the beneficiary name in the instruction request and it should be part of the fund transfer message. Transfer of funds solely rely on the beneficiary account number. The aforementioned guideline is true for both physical and online modes of money transfer.

How to retrieve a transaction?

If you have entered wrong details pertaining to the beneficiary during remittance, post checking, the bank will reject the transaction. Do check the entered account number before initiating a fund transfer.

What will happen if the transaction is a success?

In case you have mistakenly initiated a transfer to a wrong account and the fund has been credited to the other bank’s beneficiary account, you may follow the mentioned steps:

  • First thing first, inform your branch or contact your relationship manager to inform the incident.
  • Note down all the details related to the wrong transaction.
  • You might have to visit the branch to submit a written application and hand over all details along with screenshots.
  • The bank will share the beneficiary details with the other bank where the money has been transferred.
  • If the account is in the same Bank, the bank may act as the facilitator and seek permission from the beneficiary to initiate transaction reversal.
  • If the account belongs to some other Bank, it is better that you approach the branch which holds the beneficiary account and request for transaction reversal.
  • The branch will contact the beneficiary and request a credit reversal.

Is credit reversal possible without beneficiary permission?

The bank has no right to initiate credit reversal without the beneficiary’s permission. In that case, you may approach the law with all the presentable documentation and inform the incident.

How to prevent wrong transactions?

You, being the custodian of your money, should be extremely cautious while making any transaction. Check the account number, IFSC code multiple times before initiating a transfer. If you are transferring money to an unknown account for the first time, first transfer a small amount and if the credited amount has reached the recipient successfully, then you can go ahead and transfer the remaining funds.

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.