What is the process for reversing or recalling a NEFT transaction?

Question from Santosh, What is the process for reversing or recalling a NEFT transaction?

Answer from AI:

National Electronic Funds Transfer (NEFT) is a nationwide payment system facilitating one-to-one funds transfer. It operates on a deferred net settlement (DNS) basis which settles transactions in batches. In the event of an error or fraud, you may need to reverse or recall a NEFT transaction.

Can a NEFT transaction be reversed?

In general, once a NEFT transaction is processed, it cannot be reversed by the sender. The Reserve Bank of India (RBI) has established guidelines that state that there is no provision for recall of the amount once settled. However, if the beneficiary agrees, the transaction amount can be returned to the sender.

What to do if a NEFT transaction needs to be reversed?

If you need to reverse a NEFT transaction, you should:

1. Contact your bank immediately and inform them about the erroneous transaction. Provide them with details such as the transaction ID, amount transferred, and the date of the transaction.
2. Your bank will then contact the beneficiary’s bank to request a reversal of the transaction. This is subject to the beneficiary’s consent.
3. If the beneficiary agrees to the reversal, the amount will be credited back to your account.

What if the beneficiary does not agree to the reversal?

If the beneficiary does not agree to the reversal, you may need to take legal action. This could involve filing a complaint with the banking ombudsman or taking the matter to court. In such cases, it is advisable to consult with a legal professional for personalized advice.

What if the NEFT transaction was fraudulent?

If you suspect that the NEFT transaction was fraudulent, you should report it to your bank immediately. You can also file a complaint with the local police or cyber crime cell. The RBI has issued guidelines on Customer Protection – Limiting Liability of Customers in Unauthorized Electronic Banking Transactions which may be helpful in such situations.

Remember, it’s always important to double-check all details before initiating a NEFT transaction to avoid any errors or potential fraud. If you’re unsure about any aspect of the process, it’s best to seek advice from your bank or a legal professional.