The Reserve Bank of India is looking up on a proposal for making the concept of the bank account number portability a real one. The apex bank’s deputy governor S.S. Mundra had on Tuesday asked banks to follow this instruction which would allow customers to move seamlessly between banks. This move would also have taken away the hassle of customers having to change their account numbers in case of changing their banks. Mundra also said the central bank would soon finalize final guidelines on customer protection which would also limit their liability in instances of frauds in electronic banking transactions.
The concept of account number portability is not new; however, this is the right time to implement such a move. Technological innovation has made linking accounts to Aadhaar, which is the ID number issued by the Unique Identification Authority of India, easier. The deputy governor had said at an event organized by the Banking Codes and Standards Board of India on Tuesday and had warned banks against charging higher rates on services.
With the digitization of core banking and current demonetization by the Government of India net banking and use plastic money has increased by several folds in India. Many people still fear to use the internet banking.
Taking this step is not going to be an easy task for banks, however. This report by the Economic Times suggested that certain loopholes need to be addressed on the technology and data-integration front as well. Adhil Shetty, CEO of Bankbazaar, was quoted in the same report as saying,”Banks will have to restructure their account numbering systems. Many of them have different methods and streamlining these will take time. This will also involve changes in their software integration systems.”
Bankers and other experts do not seem to be convinced that this can be done so easily, however. A report by Mint has quoted Ashvin Parekh, managing partner, Ashvin Parekh Advisory Services Llp as saying,”Account portability will be bit of a challenge from banks’ point of view since they have to change file structure given their core banking solution. The mechanism will evolve but it will be expensive.”