When electronic transactions fail…

Parvatha Vardhini C | Updated on June 09, 2012


Money transfers through RTGS (Real-Time Gross Settlement) and NEFT (National Electronic Funds Transfer) have become quite popular. But as the latest Annual Report of the Banking Ombudsman points out, complaints regarding non-credit, delayed credit and delayed return of funds in failed transactions are on the rise.

The report recounts one such case where the complainant approached the ombudsman alleging inordinate delay on the part of the bank in transferring funds under RTGS.

The transaction involved disbursement of salary to staff. It did not get completed on time because when sending the request, the complainant's bank failed to mention the account number of the beneficiary.

Due to this, the amount was kept in suspense, credited back to the inward account and then credited to the beneficiary's account after a considerable time gap. He demanded Rs 1 lakh in damages towards mental agony and for delay in disbursement of salary. As this was clearly a lapse on the part of the bank, the ombudsman directed the bank to pay Rs 80,000 towards the loss of man-hours and productivity due to non-payment of salary in time.

Considering its convenience, all of us use electronic payment modes. Hence it pays to know what can be considered an ‘on time' transfer and the recourse available for failure of transactions.

Time Limits

Under RTGS, funds are to be transferred immediately. The beneficiary bank is expected to credit the beneficiary's account within two hours of receiving the funds transfer message. Under NEFT, transfer of funds happens in hourly batches.

For NEFT transactions between 9 a.m. and 5 p.m. on weekdays, and 9 a.m. and 12 noon on Saturdays, credit to the beneficiary account will happen on the same day.

For transactions outside these time slots, credit will be given either on the same day or the following day. An e-mail or SMS confirmation of the credit will be sent to you by your bank.

In both cases, if it is not possible to afford credit to the beneficiary's account for some reason, destination banks are required to return the amounts within two hours (in case of RTGS) and within two hours of completion of the batch in which transaction was processed ( in case of NEFT).

So, you can expect a reversal of the debit to your account within a maximum of 3-4 hours.

If you find that your transactions have been delayed beyond these norms or the amount has not been credited at all, you can approach your branch as the first step.

Whom to approach

If you are unhappy with the response, for RTGS transactions, you can lodge a complaint with the Customer Service Department of the RBI (I Floor, Aman Building, Fort, Mumbai – 400001/ cgmcsd@rbi.org.in).

For NEFT transactions, you can contact your bank's NEFT Customer Facilitation Centre whose details are available at http://www.rbi.org.in/Scripts/bs_viewcontent.aspx?Id=2070. You can also approach RBI's Customer Facilitation Centre. (National Clearing Centre, I Floor, Free Press House, Nariman Point, Mumbai – 400 021/ nefthelpdeskncc@rbi.org.in ).

Moreover, for NEFT transactions, banks are required to pay penal interest at repo rate plus two per cent for the period of delay ( i.e. delay in crediting the beneficiary's account), or till the date of refund (in case of failed transactions) to the affected customers.


Published on June 09, 2012

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