New IMPS rules will come into effect from February 1, 2024, making fund transfers easier where beneficiary details are not needed except for the recipient’s mobile number and bank name
In order to simplify money transactions, the National Payments Corporation of India (NPCI) has set a deadline of February 1, 2024 for banks to enable users to complete Immediate Payment Service (IMPS) transactions using just the recipient’s bank account number and mobile number.
At present, IFSC Code is also mandatory for IMPS transactions if it is a person to account transaction. IMPS transactions have a daily maximum limit of Rs 5 lakh and levy an additional service tax.
Now, it is being proposed to start fund transfer through mobile number and bank name in all IMPS channels by January 31, 2024, according to a guideline issued on October 31, 2023. The guidelines asked banks to maintain a mapping of member bank names with default mobile money identifier (MMID) and make UI/UX improvements to facilitate beneficiary validation and financial transactions using mobile numbers and bank names.
IMPS is one of the most commonly-used ways of real-time fund transfers 24x7 through multiple channels such as Netbanking, mobile banking, ATMs, SMS, and IVRS. The service ensures swift interbank electronic transfers, reaching the destination within minutes. Most banks impose a nominal service charge for IMPS transactions. At present, 827 members, including banks and prepaid payment instruments (PPIs), are live on IMPS.
At present, IMPS transactions are done through P2A (Account + IFSC) or P2P (Mobile Number + MMID) transfer modes. It means that to make an IMPS transaction, you must have the receiver’s mobile number and MMID. In case you don’t have the receiver’s MMID, then you must have his/her bank account number, IFSC and Aadhaar number.
MMID is a 7-digit code that is issued by a bank to its customer in order to facilitate mobile banking services. Each mobile banking account has a unique MMID allotted to the user by the bank itself. You might remember having seen a code that has the first four digits of the MMID code, which is basically the distinct ID number of the bank offering the IMPS services. But from now on, these beneficiary details will not be needed except for the recipient’s mobile number and bank name.
When users have multiple accounts linked to the same mobile number, they can set one account as default to receive and send money from. Users can change their default account at any time. For multiple banks linked to a single mobile number, the beneficiary bank shall credit the primary and/or default account which shall be identified using the customer’s consent, according to the NPCI guidelines. In case customer’s consent is not provided, banks shall decline the transaction.
Here’s the step-by-step guide to make payment through IMPS.
Open the mobile banking app and navigate to the fund transfer section.
Select the IMPS option and enter the recipient’s mobile number and select the beneficiary bank name.
Enter the amount you want to transfer up to Rs 5 lakh and click on confirm.
Enter the OTP received and authenticate the transaction.