With the recent mergers of banks in the public sector, many account holders will be forced to abandon their old Indian Financial System Codes (IFSC). According to a report by Gadgets Now, the old IFSC codes will no longer be valid for online banking use. The banks involved in these public sector mergers are Syndicate Bank, Allahabad Bank, Dena Bank, United Bank of India, Vijaya Bank, Oriental Bank of Commerce, Andhra Bank and Corporation Bank, the report added .
Account holders of these banks would have to change their old IFSC codes in accordance with the new banking regulations after the merger in order to have access to all online banking transaction options. In the event that account holders want to make an online transfer from or to the named banks, they must delete the beneficiaries from the list of payees on the relevant online banking web portal.
Account holders can then use the portal to register for the new IFSC codes to which the data must be added again. The list of payees must then be re-listed and registered under these new conditions. It does this by adding their names, account numbers, contact details and bank details that contain the new IFSC codes. Until registration, account holders of the newly merged banks can only then transfer money online via netbanking facilities.
It’s also worth noting that if there are standing orders or scheduled payments, they must be deleted first and then added back in to get the right results.
The mergers are as follows: Syndicate Bank merged with Canara Bank, Allahabad Bank was merged with Indian Bank, Vijaya Bank and Dena Bank were both incorporated into the Bank of Baroda. The merger of Syndicate Bank and Canara Bank came in light of the National Democratic Alliance (NDA) government’s plan to implement new banking reforms in 2019. With the consolidation of the two banking institutions it became one of the largest public banks in the country.
Finance Minister Nirmala Sitharaman said in August 2019 that the merger of such banks would be aimed at cost-cutting purposes. She went on to say that this would lead to a reduction in operating costs due to network overlap and more income opportunities for joint ventures (JVs) as well as subsidiaries.
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