6.5 million Debit Cards compromised in India

6.5 million Debit Cards compromised in India – Was your card one of them?

Posted on October 21, 2016November 20, 2019 by Jagoinvestor

Around 6.5 million Indian Debit Cards have been compromised recently which is one of the biggest security breaches our country has seen to date.

Around 641 customers of 19 different banks have reported frauds worth Rs 1.3 crores in total as of now and after that, all banks started investigating the matter. Some of the banks that are worst affected are SBI bank, ICICI bank, HDFC bank, and Axis bank.

Here is a real incident reported by Vishal Sharma on this article below in the comments section

My card got cloned and my account was wiped out on 5th Sept 2016 by cash withdrawals from china . I immediately informed my bank Standard chartered who then blocked my card. It took 10 days and a lot of following up before they gave me a temporary credit.

SBI alone has reported that it has blocked around 6 lacs debit cards and going to issue new cards soon. This is done as a precautionary measure so that no frauds are done on these 6 lacs cards.

As per the following video, these compromised debit cards were used in the US and China while the debit card owners were in India.

How did this all start?

Around Sept start, various customers started complaining to banks about the fraudulent transactions, and that when banks started reaching out to National Payments Corporation of India (NPCI), which found out that it was a malware-related security breach in various ATM’s and Points of sale systems which were managed by Hitachi Payment Services.

That’s when the banks asked its customers to change their PIN. Banks also blocked cards and started providing the new cards to its users.

The banks are saying that this security breach has happened outside the bank’s network, but still, the investigation is going on right now and more details will come up in coming times.

How did the security breach happen & What got Hacked?

As per the above video from NDTV, almost every detail of the card was hacked like

Name on the card
Expiry Number
Card Number
CVV number

When you use your card at an ATM or a point of sale (in some shop), the data first goes to a central server (central server switch) and that further sends the data to your bank to check if you have balance in your account or not. This central server had the malware sitting and the data was compromised at that point.

Around 3.2 million debit cards hacked in India

Can you take some precautions?

The only thing you can do right now is either change your PIN. Most of the security measures are already taken by the banks, so you can’t do much from your side now other than getting your card blocked (not recommended). You can read more details about this news here

Do you know anyone who faced the card fraud? Can you share that?

What do you think about this issue? What are your views?

10 steps to ensure safety of your ATM/Debit/Credit Card usage

Posted on August 10, 2016November 14, 2019 by Jagoinvestor

In the last 10-15 yrs, card usage has replaced cash transactions to a big level at least in urban India. We no longer go to banks to withdraw cash. Almost everyone prefers to pay by cards when we visit malls, grocery shops or when we fill petrol in our cars.

Increase in Card Frauds

While the ATM/Debit/Credit card usage has increased, so has the frauds related to the cards. Most of the time, card fraud happens due to negligence of the cardholder. In this post, I will talk about several things you should keep in mind which will safeguard you against fraud or any crime which can potentially happen. The things we talk about in this article will be for ATM cards, debit cards, credit cards, and even internet banking transactions.

atm safety tips

1. Destroy the CVV number on the back of the card

Once you have used your ATM card several times, it’s suggested to scratch the CVV number on the back of the card. Almost everyone will memorize the 3 digit CVV number once they have used it 5-10 times. You can also write down the CVV number in your mailbox and email it to yourself if you want to record it in someplace.

While this will not make you fully protected from fraud, but it will surely reduce the chances.

2. Change the PIN as soon as you receive the card

Once you receive your card for the first time, it’s suggested that you activate it asap and then change the PIN. Try to avoid keeping the PINs that resemble your birthday, Pincode or phone numbers. Make it a random number or some combination which you can relate to.

If you do not change your default PIN which the letter contains, it might happen that someone looks at it and misuses your card, given they have access to it. That’s the reason you should also destroy the old password document.

3. Activate SMS Alerts for any amount above ZERO

It’s suggested to activate the SMS and mail alerts for all transactions.

If you do not want any SMS for a specific amount like Rs 500 or Rs 1000, then you can set up the alerts above that amount, but make sure you do it. A lot of people who come from the old generation like our parents, uncles etc are new to these card payments and do not activate these features. Please do it for them

4. Keep the customer care number saved on the phone

It’s always a good idea to store your bank/card customer care numbers on your phone so that you can inform them about any fraud or issues as soon as they happen.

Imagine you lost your card and you are thinking – “Once I am back home, I will call customer care and share about this incident so that they can block my card”. This is not a great situation, because, within a few minutes, the who has the card can swipe it and use it (given he knows other details)

Better avoid being late in informing about the incident, because once the money gets debited from your account, then matter becomes complicated and you will spend lot of times in fixing the issue and following up

Prevention is better than cure …

5. Avoid using the ATM in night or places which are not safe

There have been instances where I wanted to withdraw cash from ATM around night-time, and my wife always tells me that we can always do it the next day in the morning because it’s better to avoid ATMs at night especially when it’s not an emergency.

I think that makes sense.

While, out of 100 times, 99 times nothing will happen. But then that one bad incident is what you want to avoid..

RIGHT?

I am not saying that never use the ATM in the night, but as far as possible, try to refrain using your cards at night at lonely places, because you never know who is keeping an eye on you.

Here is a video from Bangalore, where a 38 yrs old lady was attacked by a guy inside the ATM. Something like this is very much possible to happen if you take things lightly at night when it’s lonely.

Hence, if are going back home in midnight and thinking of withdrawing cash from an ATM which is located on a lonely road, I suggest that you avoid it unless it’s emergency. It’s always safer to come back in the morning and withdraw the money from ATM.

6. Don’t let any once enter the ATM while you are using it

If there is only one single ATM machine inside the room, then don’t allow anyone to enter the ATM when you are using it. You can directly tell the person to enter the room once you have used it.

At times, People are not civilized enough to understand that ATM usage is a very private activity and they should not enter or look at your screen.

stop atm fraud

(Image Source)

7. Never leave an incomplete transaction

There are many ATM frauds which have happened because the person left without completing their transaction. You should never leave the ATM screen unless the “welcome screen” appears back.

There are cases, where the computer hangs in between the transaction either because of a technical issue or because someone had done some trick to it. Always press the cancel button once you are finished or sense that there is some issue.

Below is an excerpt from a report from Indian express which shares more details about keypad jamming fraud in ATMs.

Keypad jamming fraud

The risk department of the banks have termed it so because the modus operandi of defrauder involves jamming both the ‘Enter’ and ‘Cancel’ buttons on the ATM machine by applying glue or by inserting a pin or blade at the edge of the button. So when the customer tries to press the ‘Enter/OK’ button after entering his ATM PIN, the key does not function and the customer can’t proceed with his transaction. At this juncture the customer thinks that the machine is not working and tries to cancel the transaction, which also does not go through as that button is also jammed. Thinking that the transaction is cancelled, he leaves the ATM machine.

As soon as the customer leaves or is prompted to visit the nearby ATM machine, the fraudster takes over the machine and since the transaction is active for around 30 seconds in most cases (some banks have reduced it to 20 seconds), he keeps the transaction active by pressing some functional buttons and in the meantime removes the glue or pin from the ‘Enter’ button to go ahead with the transaction. The fraudster then withdraws the cash from the customer’s account, leaving the customer unaware of the fraud till he checks the message from the bank.

If your ATM screen is hanged or incase of any issues, make sure you contact the security guard or at least call the customer care while you are inside the ATM.

All ATMs have a CCTV machine and it will record your activity which will help you later in case of any problem or dispute. Here is a real-life case of how ATM fraud can happen from a fellow blogger BasuNivesh.

8. Never share your debit card PIN when you shop

When you go to Petrol Pumps to fill your car or while you are dining at restaurants, try to avoid sharing the ATM PIN while making the payments. A lot of people let others enter their PIN because they don’t want to walk all the way to the swipe machine.

I prefer to walk down and enter the PIN myself or ask them to bring the swipe machine near me.

While it surely adds to convenience by sharing the PIN, but it also exposes you to the risk of debit/credit card fraud. No one is stopping the person who has your card to note down your card number, expiry date, CVV number (most of the people don’t scratch it) and write down the PIN you shared with them. In some extreme cases, your card can be swiped to the skimming machine to steal the information and duplicate the card.

how debit and credit card skimming work

A lot of people think that just because someone has their card details, they are still secured because the OTP comes to their mobile or the 6 digits extra password is asked while doing a transaction online. However, they are mistaken.

While one will surely fail while doing the transactions in Indian websites, they will succeed while using the card on international websites, because OTP is not sent there. Also, that extra layer of 6 digit password is not asked while doing transactions at many websites outside India.

9. Never share your PIN, OTP, CVV and other sensitive details

My father in law is a senior citizen and despite being a bank employee for many years – I can clearly tell you that even he might fall prey to many online frauds related to banks because he is very new to these card payments and internet banking. He belongs to that old era and his banking is very different than today’s banking.

Like him, your parents, and grandparents and in-laws will surely be from the generation who does not understand very well how these online things work.

When they get a call from someone who says – “I am calling from Bank and …”, for them it’s a genuine call and they can’t tell a difference between fake call and a genuine one. And they are always on the list of fraudsters.

There are various online frauds going on these days, where a person poses as a bank employee and then scares the person on other end saying things like

“This is a verification call from the bank, please share the OTP which has just come on your mobile”
“You will now get a new card because the old one is canceled, please share the 3 digits on the back of the card to approve this”
“We notice that a 20,000 transaction has happened just now, did you do it? Please share an OTP which has come to your mobile to verify that you are the cardholder”

Listen to this YouTube conversation, where a girl is posing as SBI staff and trying to get information. Imagine if your parents or some senior citizen gets this kind of call, how will they react?

Here is a good FAQ related to fraud protection related to cards from ICICI bank

10. Don’t expose the cash withdrawn from ATM

I have done it a few times, and I now understand that it was a mistake.

When you take out cash from ATM, if it’s a big amount – many times a few people come out of ATM holding the bundle of cash without realizing that someone might be watching them.

It’s always suggested to keep a bag with you and put the cash inside it or at least keep the cash in your wallet or pocket till you reach your car or home. There might be many bad elements nearby and they will keep an eye on you. They might be behind you and later they may attack you. What they show in CRIME PETROL actually happens in real life too 🙂

Don’t Get Paranoid

While it’s suggested that you should be alert and careful while using your cards or internet banking, but I would like to also add that you should not become paranoid and start behaving like a maniac :). You should judge the situation and use your presence of mind when someone is really being helpful and when someone is trying to trick you.

Please share any other tips or suggestions which I have not added above.

Why is ICICI bank charging redemption fees on Payback points usage?

Posted on January 10, 2016November 15, 2019 by Jagoinvestor

This is a guest post by a reader Prithvi, who wanted to share his views on the redemption charges by ICICI bank on the payback points. Here goes the article which was sent by Prithvi to me over email. We would like to have a discussion on this topic and see what everyone else has to say about this.

–
Hi Fellow Investor

This is Prithvi. I wanted to share few thoughts I have about the ICICI bank and its redemption charges on usage of Payback points.

ICICI Bank is probably the best private sector bank in this country, it is because of them that the banking scene in this country has progressed so much.

PAYBACK is probably the best loyalty program in India, before PAYBACK, people never even thought that reward points meant anything and PAYBACK was the reason that this changed in India.

Now, there is one thing that this bank is doing that is not ethical. ICICI Bank is looting its account holders with the name of PAYBACK.

PAYBACK is a loyalty reward program with ties to several major brands in the country. You can earn PAYBACK points when you shop online or offline with many outlets, Future group outlets are one of them, Brand Factory, Pantaloons, Home Town, Central. Online you can earn and spend PAYBACK points at eBay.in, MakeMyTrip.com etc, to name a few. You can also earn PAYBACK points with your ICICI Bank Debit/Credit Cards and also ICICI Internet Banking. Note that PAYBACK and ICICI Bank are different entities

American Express also offers a card with which you can earn PAYBACK points.

Now, what’s unethical here? Let’s look at how you can earn and spend points.

Ways to earn PAYBACK points

Swipe your PAYBACK card at partner outlets
Enter your PAYBACK number at partner websites
Use ICICI Bank Credit/Debit Cards/Internet Banking for Purchases
Use American Express Cards for Purchases

Ways to spend PAYBACK points

Swipe your PAYBACK card at partner outlets
Enter your PAYBACK number at partner websites and confirm spending with a PIN.

Now, there are 2 categories here

Non-ICICI Bank Account Holders
ICICI Bank Account Holders

Steps For Non-ICICI Bank Account Holders

Enter your PAYBACK number/Mobile Number on the website(e.g eBay).
Enter your PAYBACK PIN to confirm. (4 PAYBACK points = INR 1)
If you are purchasing an item that costs INR 1000, you have 2000 PAYBACK points, you will get INR 500 discount and you have to pay only the remaining 500.
The transaction completes for free

Steps For ICICI Bank Account Holders

Enter your PAYBACK number/Mobile Number on the website(e.g eBay).
Enter your PAYBACK PIN to confirm. (4 PAYBACK points = INR 1)
If you are purchasing an item that costs INR 1000, you have 2000 PAYBACK points, you will get INR 500 discount and you have to pay only the remaining 500.
The transaction completes, but you are charged a redemption fee in your ICICI account.

Here is the problem.

PAYBACK confirms that its redemptions are free of charge and also confirms that PAYBACK does not charge for redemptions.

ICICI says that they have a right to charge for redemptions because they have a tie-up with PAYBACK.

ICICI PAYBACK potential Scam

Now let’s look at a scenario where it gets a little complicated, if you have a PAYBACK card from Brand Factory and you also have an ICICI Bank account and both of them are linked, this is when ICICI begins to loot you.

If you earn points at Brand Factory, the points get credited to your PAYBACK account and now when you spend those PAYBACK points, ICICI charges you a redemption fee.

ICICI PAYBACK scam points

This is blatant robbery. ICICI has no right to charge PAYBACK users for redemptions. Please listen to this audio which was created by me to explain my views on this topic.

ICICI Bank says that it has the right to charge users for PAYBACK redemptions when contacted by email.

PAYBACK confirms that it DOES NOT charge its users for redemption.

Please share what are your views about this?

ICICI launches “Smart Vault” – Robotic technology in bank lockers

Posted on December 21, 2015July 20, 2019 by Jagoinvestor

ICICI Bank has recently launched “Smart Vault” which is a cutting edge robot managed locker service. There is almost no intervention with the bank staff and the security is very high. Watch the video below to understand how it works.

Here is how the “Smart Vault” is operated

Locker owner will swipe their debit card and enter their ATM PIN
There is a biometric authentication required
You will then enter a private room where a robot will bring the locker in front of you
You can open your locker with a unique key, provided by the bank. For added safety, you may also choose to have an additional personal lock on your locker.
Once you are done, you can keep your belongings back in the locker and robotic technology will take it back
You may leave the locker room once the “Thank You” message flashes on the kiosk screen

The vault uses robotic technology to access the lockers from the safe vault and enables customers to access their lockers at any time of their preference,” the statement issued by ICICI Bank, country’s largest private sector lender, said.

In case a customer has more than one locker, the interface allows customers to choose which locker they want to operate.

The lockers will come in different sizes and the cost will depend on the size of the locker and the city location where the locker is located (linked to real estate prices) icici smart vault size

As of now this smart vault is launched in Delhi, but soon it will replicate in other cities as well. Its a great thing because its a new innovation from ICICI bank on the locker service.

What do you think about Smart Vault service and the robotic technology used? Would like to avail such kind of lockers by paying a higher premium rents?

5 kind of online frauds, where investors have lost their money

Posted on May 28, 2015July 23, 2019 by Jagoinvestor

A few months back I got a call from an NGO based in Delhi. They were trying to help a small baby, which was a critical medical condition and needed immediate medical help and they were generating the money from all over India. Even there were social media campaigns around it. The girl talking to me told me its an urgent matter and how as a citizen, my help could mean a lot to the poor child.

various types of online fraud where investors have lost there money

I told her, she can mail me the details, so that I can look at what I can do from my side. After 1 hour, when I typed the NGO name and it turned out to be a big fraud campaign, which was widespread and many people reported their complaint.

But this was just one example. There are so many areas where various kind of frauds are going on all over the country and many uneducated people who do not understand the online world fall for it and lose their money. This is worst than mis-selling at times because in mis-selling you get bad returns or your money is stuck, but in these kinds of frauds you lose all the money forever. So I want to share some tricks used by people to do online frauds and their modus operandi. Here they are –

Fraud #1 – Fake Job Offer

Millions of people are unemployed in India and that has given birth to this job offer scam. In this, you get an email offer from a reputed company which invites you for their interview. You see all kind of numbers, venue, last date etc, and then you see a line mentioning that you need to deposit a security deposit or some basic fees, which will be refunded later.

Given so much of unemployment, a lot of people fall for this trick. The emails look very genuine when you read it, as it contains the company logo, or it might be on the letterhead of the company, but when you dive deeper and check the email id from which it was sent or the website link, you can figure out that something is wrong. Below is one such mail.

Fake job offer

Remember that no company in its senses will ever ask you to deposit any kind of money with them for an interview. Below is an example of how people lose such a big amount in these kinds of fraud offers.

Cybercrime police in Bangalore, India have busted a fraudulent on-line job racket offering nurses jobs in the UK and arrested five persons including two Nigerians. The accused had cheated a nurse to the tune of Rs11 lakh by promising her a job at the Ealing Hospital there.

The nurse had responded to the email job offer at the Ealing hospital in UK by sending her CV and educational certificates. The accused subsequently got in touch with the victim on her telephone and asked her to remit money for anti-terrorism and drug trafficking safety certificates, WHO immunization insurance and skilled immigration permit certificates.

The victim remitted Rs 11,03,500 to different bank accounts as suggested provided by the accused before she realized she had been conned by the gang of fraudsters when she stopped getting responses from the accused.

Fraud #2 – Help a child in an Emergency situation

This is what I was talking about at the start of this article.

Just search for the term “relief India trust scam” and you will see how many people got a call from this so-called NGO claiming to raise money for medical treatment of some needy baby. I got a call myself 2-3 times, and every time I kept investigating the issue to understand how they work. When I enquired about their Registration number, they even gave me that, but then it’s not a big deal. You can always start an NRO with bad intention.

They were extremely pushy and didn’t have a lot of supportive information regarding their claim. There are many other scams going on in the name of helping someone. It can be on helping a poor girl education or for the treatment of a kid, who has no one in the family.

They even go to an extent of telling you that the baby is on the ventilator and the surgery is in the next 30 minutes. You often see this in train’s also where a lady comes with a pamphlet asking for help. I am seeing that same thing from last 30 yrs in sleeper class. Even I see the same thing on some buses.

Coming back to the online version of fraud Here is two such experience from this website

relief india trust scam

I don’t want to paint all the NGO’s with the same brush. There are many good NGO’s also, they are doing good work, but many NGO’s have sprouted up, only to take advantage of these kinds of situations and exploit emotions of people to make money.

Fraud #3 – I am calling from IRDA

This is a well-known scam these days. Almost every investor has some or the other kind of insurance policies, especially from LIC. So these fraudsters give a call to you and ask you about your policy and tell you that they are calling from IRDA and you are eligible for some bonus after many years and in order to get your bonus you will have to either send some money or buy some policy again.

A lot of times, they have some more details about you and your policy and they look genuine at times. And many investors fall for these scams. Here is an advertisement which cautions investor’s about it

You can also listen to some sample audio calls which was recorded by some investors. You can listen to them and see the tricks used by them to cheat and fool investors.

Fraud #4 – Verification Call from Bank using OTP

This might be a new thing for many investors. In this fraud, the target is generally uneducated investors who are not that much educated or who are very new to internet banking. The fraudster poses them as a bank verification officer and gets all the information like debit card number, expiry date, CVV number, and even OTP number while doing the online transaction parallelly.

This recently happened with one of my friend’s father who lives in Patna. His father was not that well versed with internet banking and used to do all his transactions in offline mode. So naturally, he was not aware of how the system works. One day he gets a call which goes like this

Fraudster : Hello , Mr PQR. I am XYZ calling from SBI bank . Your name is on our records who recently got a debit card. We are seeing some suspicious activity in your account recently, so this is a verification call to make sure that the debit card is in the actual account holder name.

Friends Dad : Oh ok .. What needs to be done to secure my account ?

Fraudster : Please verify your debit card number and the expiry date . It would be written on the card.

Friends Dad : (shares the numbers)

Fraudster : If you check on the back of card, there is a 3 digit number, its called CVV number. Please share it with me. Is it printed there ?

Friends Dad : Yes, its there .. Its 645

Fraudster : Ok , I have initiated the verification, I am now sending a 6 digit code to your registered mobile number, share that with me and then delete the sms. Please dont share it with anyone else

Friends Dad : Yea, I got it just now .. its 745523

Fraudster : Ok great , you will get a sms in sometime informing you about the verification success .. I am now disconnecting the call. Thanks for your time

Friends Dad : Thanks ..

( After 30 seconds …. there comes an sms )
"Dear Customer , Your Ac XXXXXXXXX567 is debited with INR 24,500 on 27th Apr .. Your available balance is INR 34,000"

The real story?

What happened in the background, is that the fraudster tried to make an online transaction on some website, which required a debit card number, expiry, and CVV number. After that, an OTP is required, which comes to the registered mobile number. Note that the modus operandi might deviate a bit, but the point is the same.

The fraudster tries to show himself as a bank verification officer and asks for all the details. I know you and I might quickly judge that this is a fraud call, but millions of people who are from a rural background or from past generations cannot.

Because first, they don’t understand the online world and the new way of banking which has come into the picture in the last 10 yrs and they are sometimes quite afraid of making a mistake. When they are told that their account is compromised and their money is at risk, they take wrong decisions in haste. Below is another real-life example of this kind of fraud

banking fraud using otp

Hence, make sure you never share your card with anyone or share its details like CVV number of ATM pin. A lot of people do it in Restaurants and Petrol pumps. 99.9% of times, nothing happens, but we are talking about that 0.1% times when things can get nasty.

Fraud #5 – Please verify your bank details (Phishing)

It’s a very common kind of fraud in the online world. It’s called Phishing, which aims to steal your sensitive data like username, password or card details. You get an email asking you to verify your account or details, failing which your account will be closed.

When you click on the link, it takes you to the website which looks exactly similar to your bank or card company, you enter your details thinking that it’s your bank website only. But in reality, it’s a fraud website which captures your sensitive information, which later is used to do transactions and you lose the money. Below is a youtube video explaining how it works.

Here is an example of an email which I got on the name of SBI bank.

SBI fake mail

So make sure you do not fall for any kind of emails asking for your sensitive details like the password or PIN number. No bank asks for it ever.

Even I have received fraud call from a guy stating to be RBI Officer. He claimed that my bank account will be closed because it is not linked with my Aadhaar number. Fortunately, I recorded the call because I knew that he was trying to fool me so that he can know my card details. To win my trust he made his senior also talk to me.

How to prevent yourself from getting trapped in these situations?

From the last 10 yrs, this kind of online frauds has increased because the whole world has moved to the web and all kind of transactions are now online. It’s important to be attentive to your actions and with whom are you interacting.

You will never receive a phone from RBI or Other banks for reasons such an Aadhaar not linked etc.. Please be aware that if there is any recent activity such as if you have deposited some cheque then you might receive a call if bank officials want some information regarding the cheques. Otherwise, no calls from banks for any backdated activity.
Never share your card number, CVV number, OTP etc.. to anyone.
Download Truecaller in your phone. So if you receive a call from an unknown number who is asking your bank account details then you can check the number in Truecaller. Truecaller will tell you if this number is spam or not and if it shows to be spam then block the number.

Have you come across any other kind of online frauds other than listed above?

What happens when you accidentally transfer money to wrong bank account ?

Posted on January 1, 2015July 23, 2019 by Jagoinvestor

Have you ever wondered what will happen if you accidently transfer money online to some strangers bank account ? If you are thinking thats its a rare event, you are wrong. There are thousands of real life cases where a person transferred the money to someone account and then realised that one digit in account number has changed by mistake .

Do you get the money back ?

What are the rules from the bank side and what are your rights as a customer? We will look at this topic today, so that you know what you need to be careful about !

Before we go ahead, I would like to show you some real life examples and complains people have given

Real Life Example 1 – How Rajni transferred Rs 30,000 to strangers account

I did online transaction of transferring Rs 30,000 with ICICI Bank on September 30th,2008.By mistake I transferred money to wrong account number which I did not intend to .I wanted to transfer money to Adarsh Kumar A/C – 000501518633 but by mistake i transferred it to someone by name Virender Asati A/C 000501518366.I gave written letter to ICICI bank ,GT Road ,Jalandhar branch on Oct 4th which they are not able to trace and then I gave one more written letter to ICICI,Dwarka Branch ,Sector 5 ,New Delhi where I am holding the account in November and also sent several emails to them through net banking but ICICI back says that they can not transfer the money without Account holder’s permission . (Source)

Real Life Example 2 – How Vipin by mistake sent Rs 1,00,000 to strangers bank account

I am writing to you for a payment of 1 lac rupees through NEFT transfer on 2nd April 2012 to my sister Meena A/C . But due to a very high level technical mistake by HDFC my payment didn’t receive to my sister a/c whereas it had gone to other person account in some where. After few days when I enquired about that same we came to know that you have filled a starting digit incorrect that’s why your payment had gone to other person accounts. Here my question is to hdfc if anybody fill any information inaccurate, account will not be added as i know but in my case my all entries was correct except one digit error as you are telling us. It’s a universal awareness that there are so many mandatory requisite information criteria; when they not simultaneously completed transaction becomes failed like unmatched IFSC Code , unmatched city and even error of gender.

From that date I called so many times to customer care and visited the respective branch but I am not getting any proper answer from them and not knowing that what action is taken from your side. This is very sad to me that your are not taking any action and not giving me any assurance of my money. (Source)

Only “Account number” matters for online transfer

Let me give you shock of your life now.

Do you also think that if you transfer money to someone by adding their name, accounts number and IFSC code and if one of those does not match the transaction should fail and you should get back your money in your account. Right ?

But its far from reality ! . As per RBI guidelines, at the end of the day only bank account number should matter and name of the account holder and IFSC code are additional information which should be ideally checked by bank on their end, but there is no rule like that.

If you mess up with the account number, the transaction can go through you the money will be transferred. Its totally a bank choice and a “suggestion” from RBI to banks that they should ideally match Name and IFSC code before the transaction, but its not mandatory.

Below is the RBI notification for you to read, which clearly states this. I suggest you read it fully to understand how the banking world thinks and works.

Responsibility lies with the remitter and not beneficiary

As per RBI directions, the final and sole responsibility of cross checking the account number, Name of the account holder, amount and every other detail lies with the remitter (the person who is sending money) and not the beneficiary (who is getting the money) . You can check numerous times before clicking the final button and after that no one else is responsible for your loss or transaction.

You as customer can not blame the bank to not check details at their end. There are thousands of cases where while typing the account number, one last digit got interchanged with another digit and the person did not realise this and their money is then at stake and in most of the cases , they never got it back. (You can learn more about NEFT and RTGS here)

If the account number does not exist, then surely the money will come back to you, because there is no valid destination to send the money. But if the account number exists and its active, then there are high chances that the transaction will go through .

What you should do if you have accidentally transferred money to wrong bank account ?

If you have made a mistake of transferring the money to a strangers account, then you should follow these steps mentioned below

The first step is to make sure you inform your bank the moment you realise that unintended money transfer has taken from from your end. The bank will then contact the beneficiary account holder and try to explain the situation to them. They will ask the account holder to give them permission to reverse back the transaction. In most of the cases, I have read on internet that the recipient of the money have agreed for the reversal (We have good people in this world, despite widespread belief that world is evil) . Below is a real life incident where the person sent back the money.

In some cases, where the other party is greedy (when amounts are quite big) , the other person might not revert back at all or just delay the whole thing and withdraw the money or just don’t take any action . In which case you really are in a fix and it becomes almost impossible to get back your money.

You should then meet the branch manager of your bank, who can go one step further and talk to the destination bank and if they can help in this or in communication with the beneficiary.

One important point to note here is that bank cannot reverse the transaction from their side without the customer approval, because its a breach of agreement and is not the right thing. You never know what exactly is the whole story and who is saying truth (I can pay you and then just say, it happened by mistake)

3 Precautions you should always take while transferring money Online ?

Precaution is better than cure, I personally believe that we are ourself responsible for any money transfer done online. Nothing stops us from taking extra precautions while transferring money online.

Lets see few things you can do ..

Trick #1 – Use CTRL-F to verify your account number

Most of the times, we are typing an account number which we have got in our emails, we look at the number (few digits at times) and then type it in other window when we are adding the beneficiary. What I personally do is once I have typed the account number (you cant copy paste the account numbers in all the bank website, as its disabled) . In that case you can just copy your account number from email, and type CTRL-F and paste the number there and you can visually see if it matches with what you just typed. Below is a screenshot I created for you to understand what I am talking about..

Trick #2 – Transfer Rs 1 first and test the transaction incase of big amounts

If you are transferring a big amount to someone, you can go one step ahead and first transfer Rs 1 and then confirm with the beneficiary if they have got it, and then on confirmation, you can trasfer the full amount. But I suggest to use it only in extreme situations when you really want to make sure if the account is genuine or not. At times, you might come across someone who gives you their account number and you are aware that they are careless by nature, and might have made some mistake while sharing account number, In that case you can take this extreme precautionary step ! .

Trick #3 – Verify the account number from right to left

Generally we are programmed to read left to right and we also match the account number that way, truly speaking, it might happen that we sometimes get fooled by our own confidence (4 zero , might look like 5 zero) .. So its better to also cross check the account number digit by digit from right to left. I personally cross check an account number digit by digit 2-3 times because I transfer any money online. I have never faced any issue of wrongly sending money to strangers account or sending excess money by mistake (One excess Zero in 10,000 and it becomes 1 lac) ..

Spend 1 extra minute to save your self big trouble

I hope you are clear by now that its your mistake if you transfer money to someone else account and you cant held someone else responsible for your mistake. Hence its always better to add the beneficiary account with precaution. Always cross check the account number 2-3 times.

I would be happy to know if you benefitted by this article and if there are any real life incidents around this area. Also please share anything related to this topic in comments section.

21 tips you should follow to secure your banking transactions

Posted on December 26, 2014July 23, 2019 by Jagoinvestor

The world of banking has evolved too much in last 10 yrs and the way banking happens now is totally different from past. Millions of people across the world still do not take simple precautions while they should ideally take or they are too casual about things and later regret when they lose money in some kind of fraud.

Today I want to talk about simple tips and precautions which you should take in your banking and while transacting with debit and credit cards online. It’s up to you to see which of the suggestions and tips suggested applies to you and how deeper you want to be secured. Here are those tips

1. Scratch your CVV number

It’s one of the most common mistakes almost every credit card and debit card holder does. On the back of your card, there is a 3 digit CVV number, which is very critical information and only you should be aware about it. The first thing you should do after getting the card is that you should memorize and write it down somewhere and then scratch it, so that someone else can’t have a look at it. Note that this step will secure your CVV, but then you have to remember it, you can’t retrieve it back if you forget it yourself!

2. Make sure your internet banking password is very strong

Your password for internet banking is probably the most important thing you have to take care of. Make sure you keep it very strong. Do not use your date of birth, name, etc in password, so that one can’t guess it and it’s only known to you. Make sure you have Capital Letters, Numbers, special characters in the password (anyway it’s mandatory in most of the banks portals).

And if possible keep a long password, which makes it tougher to crack and even if someone is watching your fingers typing movement, it becomes extremely tough for them to remember. It’s a good idea to check your password strength on this password strength calculator

3. Make sure have sms alerts enabled for any amount

Make sure you have SMS alerts for all the debit and credit transactions. A lot of online frauds are series of transactions like buying 10 times on a similar site or couple of recharges to various mobile phones. If you get notifications on your phone even for small amounts, it will help you identify the start of a fraudulent activity.

4. Make sure you buy insurance for your wallet and its contents

Companies like OneAssist and CPPIndia have products like wallet insurance, which will cover you from theft and other frauds which are possible in day to day life. Not just that, they have much more than just insuring your credit and debit cards.

If you have ICICI bank Account, you can upgrade your debit card to RubyX and you will get One Assist complimentary benefits for your wallet insurance. Read more on this topic here

5. Do not save your banking passwords in Phone or Email in plain English

It’s a human tendency to take the shortcut route all the times, but when there is your money involved, it’s better not to ! . Do not store your banking passwords etc (I would say any password) in plain English in your emails or drafts or phone. Always make sure it’s in some format which only you understand, like interchange the alphabets one after another (e.g. – 12A47* becomes 214A*7) , so that you know what is the password, but even if someone gets access to it, has to spend some time to crack it. If you can avoid that also, it’s much better.

The other thing you can do is, you can just store start, middle and end 1-2 characters, because most of the times, we just need the start (most of us have multiple passwords). So if your password is MANISH987_FAKEpassw0rd , then you can store it as MA…98…FA…rd , and that’s all . You will most probably be able to recall it considering you are using it from long time, but someone else will not.

6. Never share your CVV / Expiry date to anyone on Telephone or email ever

Being financial literacy at low levels, millions of people are not aware which information is critical and which is not when it comes to credit cards, debit cards and online banking. Things like CVV , your Expiry dates etc are never ever asked by any bank customer care. They ask things like card number, start date, date of birth etc for verification purpose. But there are scams going on internationally where scamsters pose as actual customer care and in name of verification call, they ask for CVV number and Expiry Date, which is extremely confidential information and no one other than the cardholder should know.

7. Don’t let others punch your PIN at restaurants or Petrol Pump

I have seen tons of people who share their debit card CVV number at hotels while dining or even at petrol pumps just because its shortcut, and in 99% cases, nothing happens too and you are safe. But that 1% case is dangerous where someone looks at your expiry and CVV number, and then do the online transaction without requiring your OTP password (6 digit) on international websites (that last level authentication is just applicable for Indian websites)

I personally think you should punch your PIN yourself and not share it with others. Most of the time some restaurants even carry the EDC machine and bring it to you. If you are sharing your PIN with others and handing over cards at hotels, don’t be surprised if someday you get a sms saying – “You just purchased …. worth $340 at amazon.com” , it happens and very much can happen with you too! . Read the incident below

Four unauthorized transactions happened to my ICICI credit card on 27 Jan 2014 in USA in a Grocery Shop amount $1200 (Rs 70000) approx. The Credit card was with me all the times at Bangalore and I never shared my credit card or personal info to anyone. I was using the ICICI credit card from last 6 years. The transactions happened in night and in the morning I show the sms alerts and called customer care about that. (Source)

8. Have the customer care numbers in your mobile for emergency purpose

You should make sure that you have your credit card company customer care stored in your mobile to inform them as soon as possible in case there is some fraud transaction with your account or card. At times, we come to know about the fraud and we feel that we will inform the customer care as soon we reach home/office. But that can actually turn against you because of delay.

9. While using your ATM card, make sure you block the view of others

Looks are deceptive . You never know who is watching you and your activity and what’s their plan? It’s always a good idea to cover your hand while punching the PIN and make sure no one is looking at you. If its ATM, make sure no one is around you. I know many must be thinking that they should probably skip this point, but only when some fraud happens, you realize how important it is.

It’s like people start wearing helmets only after an accident and buy health insurance only when someone in relatives had paid a big bill at hospital.

10. Avoid ATM transactions very late at night or at lonely places

If possible, it’s better to avoid ATM transactions at lonely places or at nighttime especially after 10-11 pm . If you are using ATM’s at remote locations, you have to be extra cautious. There are numerous cases where someone entered the ATM while someone was using it and they at gunpoint looted them or because it was lonely and dark, someone tried to rob someone coming out of ATM.

11. If you don’t swipe your cards regularly, keep it at home

I do this myself. I generally use only credit card when I am transacting offline, and use credit card only for online transactions, so I don’t not carry my credit card at all (haven’t seen it from last one year actually). So if you do not use it on a very regular basis or only in some pre-know situations , then it’s better to carry them only when you require them. Else just keep it at home.

I know this does not apply for many people, but you can still learn from this point .

12. Do not put much info on Social Media

I have seen numerous cases of people sharing their bank account details, phone number, email id, PAN and even date of birth online one various portals online (even on this blog) especially on consumer complaint websites. Note that you can write your entire story without your critical details too. Never share your personal details with anyone stranger or on public forum

13. Enable Two Factor Authentication for your transactions

Enabling two factor authentications means that you will be asked to enter your transaction password and then either an OTP (which comes on SMS) or your card grid values. So there is security at two levels.
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Most of the banks now have this by default, but if your bank has a choice of it, then you should enable it and if your email accounts are too precious, then even they have two factor authentications now (Gmail)

14. Never click on links on email to go to sites

You should never click on the links which come on your email and visit the website of a bank or credit card company. That might be a fraud email, which is taking you to a similar looking website. As far as possible, always make sure you only open the website either by clicking on a pre-stored web address or book marked one by you or type it yourself and always make sure it starts with https://

Below is an example of one such email which was sent by a fraudster on the name of Axis Bank Security update, which was taking the person to some other website on clicking the link mentioned in the email.

Image Source (read the full story on this link) 15. Never access your internet banking passwords and accounts from cyber cafe and someone else PC

You should make sure you do not access your internet banking (and even your important mail accounts) from a public computer or unsecured networks. Places like cyber cafes are a NO NO .. I would even make sure that I do not operate my internet banking from someone else computer too. You never know what kind of softwares are stored on someone computer. There are programs called “Key loggers” which record your which keys are you typing and it keeps a note of it and can later be retrieved.

Even some viruses and Trojans might be stealing your important information on real time and you might be at risk

16. Make sure your computer firewall is turned on and are running antivirus software

A lot of people turn off their firewall to increase the speed of internet . Make sure you avoid keeping it off. The firewall of your computer is extremely important to protect you. Also, make sure you have a good antivirus installed in your computer and keep cleaning it from time to time. You never know what bad thing got installed while you were downloading something over the net (especially when you use torrents)

17. Use Mobile Antivirus in case you access banking from your phone

If you use your mobile frequently to access banking, then it’s a good idea to have even mobile antivirus installed . Most of the troubles come from the least expected people and place.

18. Do not choose to save your passwords in browser when it asks for it

When you login to any website with username and password, browsers often ask you if you want to save the password, so that you it auto populates it next time.

19. Keep your computer OS and browser up-to-date

Its highly recommended that you have an up-to-date browser and Operating system (I hope no one has Windows XP or Vista or old version of IE/Mozilla/Chrome) . There are several security updates which keep coming and many loopholes are detected and fixed from time to time. Almost all the banks suggest it clearly that users should keep their OS and Browsers updated. ICICI bank also mentions it on their security tips webpage ..

20. Use Virtual Keyboard if possible

You must have seen a keyboard kind of interface which can be used while typing password and username, you can use it to make sure you are safe. As I explained before, there are programs like ‘Spy Ware’, which can detect which keys are you hitting and can steal that data. But when you use the virtual keyboard, it can only record which keys you pressed because it’s not happening on your computer, but one the bank server (experts on this topic, please correct me if I am wrong)

You should read more on this topic here

21. Use a separate browser for banking purpose

I think it’s a great idea to use a separate browser itself for banking purpose. Like if you are using Chrome for your other browsing, you can keep Firefox reserved for the banking related activities. I know this might sound like it’s going to extreme level of security, but then it depends on how paranoid you are about this security thing. It’s a personal choice of yours. If you do this, you can choose to disable the cache at all and not save anything in browser at all by default, no plugins , no add ons .. just pure minimal level of browser.

Secure your Banking NOW!

I know that most of the people might be following a lot of things mentioned here. Now it’s time for you to follow the other things mentioned here. Banking is one of the core element of your financial life, which can be considered the central element I would say. It’s extremely important to take care of it with highest level of security.

I would love to hear your comments and any new tips if you want to give from your side?

What happens when Bank locker keys are lost?

Posted on June 26, 2014August 6, 2019 by Jagoinvestor

Have you ever pondered the consequences of losing the bank locker keys? In this article, I will share what to do when you lose your locker keys? What are the rules and charges involved in setting things right again?

what happens if you lose your bank locker key? How much fine you will have to pay to get your new locker keys?

What happens when you go to open the Bank Locker?

When you open a Bank locker, you are billed in advance for breaking charges and 3 years of rent (the former is to cover emergencies when the locker might have to be broken). RBI guidelines state that banks can charge this extra fee if they wish, but some banks might charge it later, only if the situation arises.

You get 1 single locker key only

When you open a bank locker, there are a total 2 keys to the locker; out of these, one key is given to you and the other is with the bank. The absence of duplicate keys means that it is very important to keep your keys carefully and not lose them. However, it is very natural that some people lose their keys or misplace them.

What happens when your locker keys are Lost?

When you lose your locker keys, the first thing you need to do is write to the branch manager informing them about the loss. They can then ensure that the locker cannot be accessed by anyone (for example, by someone who stole your keys).

Once you intimate the bank about the lost keys, your locker has to be replaced by a new one (and keys) OR the duplicate keys have to be created and given to you. In either case, they will be contacting the company that supplied the locker to them (mostly Godrej).

A trained technician will travel to the bank office and cut open the locker in the presence of a bank official and the person who rented the locker. This is to avoid any dispute over the loss of items from the locker. If the person renting the locker is not available, the bank will go ahead and break the locker and move the locker contents to a sealed box, which can be passed to the customer later.

Do I need to pay high penalty If I lose my locker key? Here is a reason below

Bankers do provide a replacement of duplicate key of lockers in case the same is misplaced or lost. There is no duplicate key of a bank locker as such. The bank has to call the supplier of the locker (i.e. the company that has supplied the lockers to the banker) and the supplier provides the duplicate key.

This may entail a cost of about Rs.3000 per key. This heavy cost is due to travelling cost and other administrative costs that are involved.

Any expenses incurred will have to be borne by the person owning the locker – a sum that can run into the thousands. Just because it is “loss of keys”, one should not treat it as a trivial matter and assume that duplicate keys will be provided for free.

Penalty charges may vary from the size of the locker?

Note that expenses can vary as per the size of the locker. For small lockers, the replacement charges will be less and will increase to large amounts for bigger lockers. I think the high expenses act as a deterrent to ensure that locker owners do not treat the safeguarding of their keys as a trivial matter.

For complete clarity, I have set out below excerpts from bank T&C’s regarding this issue.

From ICICI bank website

The Hirer(s) is/ are permitted to operate the locker with the key provided by the Bank and no operation of the locker shall be permitted with a key other than the key provided by the Bank at the time of executing the Agreement.

If the key of the locker, supplied by the Bank be lost by the hirer(s), the Branch should be noticed without delay. All charges for opening the locker, replacing the lost key and of changing the lock, shall be payable by the Hirer.

From SBI Bank website

In case of loss of key of the lockers, a service charge of Rs.509/- has to be recovered from hirer in addition to the actual expenditure incurred in breaking open the locker and changing of key by manufacturer of lockers.**

From City Union Bank website

In the case of locker keys reported lost by the hirer, a written declaration shall be obtained from him/her. The bank shall obtain from the manufacturing company a fresh set of lock and key. It shall be delivered by the company in a sealed box through its technical representative.

The technical representative shall open the box in the presence of the Branch Manager and the Hirer and then in their presence the locker shall be broken open.

The contents shall be removed safely and a new lock shall be fitted thereon. Then the NEW key shall be handed over to the hirer after collecting the charges for fitting the new lock and key.

Why do we need to keep the Bank locker keys Safe?

We may face 2 major consequences if we lose bank locker keys. They are as follows –

If the keys get into the wrong hands, then you fear to lose your locker contents. After all, you must be well aware how lousy bank officials are in checking the authenticity of the person opening the locker – all they do, is fill an entry in their register and that’s the end of it.
Another issue is you will have to pay hefty fines if the locker keys are lost. The amount of hassle and financial loss you need to absorb to rectify matters is huge compared to the size of mistake. It is therefore suggested to be careful from the onset.

Let me know your views on this article. Were you aware of these rules or not?

How can you add an “extra” Godrej lock in your bank locker and make it 10 times more secure?

Posted on May 26, 2014August 6, 2019 by Jagoinvestor

Today you are going to learn how you can add an “extra” 3rd lock in your bank locker and make it really more secure compared to what it is now at this moment. This information is really hidden one and almost no one is aware about this really interesting and useful thing.

I would like to thank Jay Sheth, a reader of this blog to share this information with me in one of his comments. Let’s acknowledge him fully for his openness for sharing this amazing information with all of us and appreciate him to take out time to send me all the pictures and information which you are going to read below. The author of this article is Jay Sheth, so from now on the article language will be as if he is sharing his experience.

Why there is 3rd Key Hole in the bank locker ?

One day when I was operating my Bank locker I realized that there is a third hole in the bank locker apart from the two key holes where I and the bank person put our respective keys to open the locker. This made me wonder as to why it has a third key hole when it’s not being used?

third hole in bank locker

With these thoughts, I further researched on this. There is hardly any information on the internet. I met several authorities, contacted Godrej (who are manufacturing locker cabinets) and found something very useful. There is something called as “Renter’s Personal Lock” which is available directly from Godrej, and we could fit it ourselves easily with just a screw driver.

So if you open your bank locker, and see the exact back side of this 3rd keyhole, you will see that there is a specific fixed place along with already drilled screw holes , where this “Renters Personal lock” from Godrej can be installed. Let me show you how the back side looks like

backside of bank locker

How to Install this lock in Bank Locker ?

There two ways you can install this extra lock in your bank locker.

Method #1 – Install it yourself – This method is recommended, to install the lock yourself. It is very straight forward. When you buy this Lock from Godrej, It comes into a sealed pack, with the lock, one single key, and 2 screws. All you need is a screw driver at your end to install this. Visit your bank locker, once the bank person opens the locker for you, and leaves from there, you can then close the door first (so that no one disturbs you). And then you can put the lock in the bank of the locker and install it with screws there.

Here are the easy steps to put up the lock yourself:

Insert the key in the “extra” (bottom left) keyhole.
From the back side of the door, place the new lock in such a way that the key inserted above gets in its keyhole. This will give you the correct positioning quickly.
Tighten the two given screws with a screw driver (top left and bottom right side respectively).

Let me show you a sample picture of how it has to be installed, it will give you a fair idea.

–

install godrej lock into bank locker

Here is an important point if you are installing it on your own. Just get your locker opened and wait for the officer to walk out. Then install it at your pace and leisure. Next time when you want to open it, you will have to put both keys (the key cannot be taken out while the lock is open, which is for our safety only. But the officers will know). But that’s perfectly fine, as it is absolutely legal and allowed – just that many officers do not know the rules, so to avoid arguments with them just put it up silently for the first time. Read this incident where one guy struggled to get back his locker content back after it was closed by bank.

Method #2 – Installation by Godrej – Contact the Godrej Dealer in your city and they will send a person who will take around Rs. 250-300 as installation charges and will do it for you. This is a simple way, but cost a bit to you. There could be the following issues in this approach:

a) You might not be able to find the right person in your city, as this whole thing is not well known and even some Godrej guys are not aware about it. Manish called a guy in Pune who said that you can get this done in Pune. You might want to search a bit in your own city.

b) For confidentiality reasons, you might not want them to know the bank, location and locker number of the locker in which you intend to put this lock. Naturally, all of this is compromised if they install it for you.

c) You might have a hard time convincing the bank officials that this is indeed a person from Godrej, as many banks are pretty strict about only allowing the actual renters to enter the locker room.

Once you are done installing the extra lock, from there on, your locker will open only when all the 3 keys are applied, where those 3 keys are

Your Main Locker Key
Bank Locker Key
Your EXTRA Godrej Locker Key

Here is how it looks from the front when you have installed the extra lock.

bank locker front with godrej lock

Should I really add this “extra lock” to my locker ?

Bank lockers are very safe compared to your home locks. But then it is only comparatively safe. You must have read about a lot of incidents where there were robberies in bank and lockers were looted, you might also have read about stories of how someone’s locker belongings were missing when they checked it after many years. There is always this thought which crosses one’s mind that what if there is some security loophole, or if someone misuses your bank locker main key, what if it’s lost and goes into a wrong hand? In that case, if you are too concerned about your bank locker and want to add a 3rd layer of security (which is just one time work and costs a bit) , then you can install this 3rd lock.

There have been incidents where bank lockers have been compromised and looted . So now its your choice, if you want to add this extra lock in your bank lockers or not.

How to Buy the Personal Renter’s Lock ?

Now let’s come to the main topic of from where you can buy this extra lock called “Renters Personal Lock”. You will get this only and only from Godrej company. You can contact a Godrej dealer in your city and ask him about this lock. It costs approximately Rs. 800-1000. If you are interested in getting it installed by the Godrej person, then you should ask about this from the same dealer itself.

renters personal lock from godrej

You can buy the lock and get it via Courier

You might face some issue finding it, but don’t worry. Keep trying to find it from many vendors, try to search Godrej dealers from justdial or internet and will surely be successful.

If you are in Pune – then you can buy it from this place mentioned below.

Godrej & Boyce Manufacturing Co Ltd

4, Shop 517,Dyananda Society,

Dyananda Society Sadashiv Peth,

Pune, Maharashtra ( West ) – 411030

Phone – 020-24471453

Price mentioned by them over phone to us – Rs 880

If you are outside Pune, you can still buy it and get it delivered via courier

Manish called them and confirmed that they will be able to deliver the lock via courier to all over India, however the courier charges will apply apart from the lock price of Rs 880.

Just call 020-24471453 and the contact person is Mr. Gafur Shaikh . Hope you get it 🙂

(Please understand that we are just connecting you to them, and nothing else. If you face any issues with them, it will be between you and them, dont blame us for that)

Let us know if you are going to install this extra lock in your locker or not. Also tell us what you feel about this information.

Finally thanks Jay for sharing this useful information with all of us.

Penalty Charges on failed transactions due to insufficient balance at other banks ATM

Posted on January 30, 2014August 21, 2019 by Jagoinvestor

Imagine this situation. You are in urgent need of cash and looking around for your bank ATM, but you are not able to locate one, but you can see other banks ATM and then finally you give up and want to withdraw the cash from other banks ATM knowing that its FREE to withdraw the money from other banks ATM (at least 3 times a month)

have you ever been charged penalty on failed transactions due to insufficient balance at other banks ATM?

Then, You go to other bank ATM and withdraw Rs 5,000, but you see the message on screen “Insufficient Balance, transaction Failed” only to realize that in a hurry, you have punched in an extra ZERO and have tried to withdraw Rs 50,000. You then ignore this minor mistake thinking that it means nothing and then finally you withdraw Rs 5,000 and leave the ATM happily!.

However, By the end of the month – when you are looking at your bank statement, you are in horror to see that there is some Rs 28 debited from your account as ATM decline charges and you are like – “What the hell is that”? You talk to customer care and come to know that there are some “ATM decline Charges due to insufficient balance”, you are not happy as you were not aware of it and customer care just has one answer – “It’s as per RBI guidelines”!

Penalty charges due to Insufficient Funds

Almost all the banks charge you a penalty charge if your transaction at other banks ATM is declined due to insufficient fund. So if you have an ICICI bank account and you are withdrawing money from HDFC or SBI ATM and if the transaction fails due to insufficient balance or fewer banknotes inside the ATM, the transaction will fail and you will be charged!

Here is a real life incident which happened with my Father, when back home, he tried to take out some money from SBI bank ATM (the account is with ICICI bank) and he was not that sure of the exact balance and he tried to take out the money 3 times in a row. We only realized about this charge when I was looking at the bank statement at the end of the month.

2	07/02/2011	ATM DECLINE CHG/08-JAN-11/2713	DR	INR 28.00
3	07/02/2011	ATM DECLINE CHG/08-JAN-11/2713	DR	INR 28.00
4	07/02/2011	ATM DECLINE CHG/08-JAN-11/2713	DR	INR 28.00

How ATM decline charges are calculated?

Decline charges are the base charges + service tax! Each bank is free to define the penalty charge. So in the case of ICICI Bank (and other several banks), the penalty charges are Rs 25 per failed transaction. So when you add service tax, the final figure is Rs 28 (approx). Here are some of the bank penalty charges I found out on their websites.

ATM decline charges for insufficient balance

Is it for real that people pay penalty when there is insufficient cash in the ATM?

If it’s customer mistake, one can still understand the penalty charges, but what do you say about charges, when your transaction is declined because of the bank mistake ! , like if notes in the ATM are not sufficient? What if you are trying to withdraw Rs 5,000 but there are just Rs 100 notes in the ATM (Rs 500 are over) and the transaction failed (maximum 40 notes at a time is allowed) and you are charged for the failed transaction in other bank ATM ?

Here is one incident !

Dear Sir, I the undersigned wish to inform you that i am having saving account no. ******84712 with State Bank of India, Vadgaon Branch, Pune. When I was having balance of Rs.5106.19 (9th January 2014) in my account I went to SBI ATM at laxmi road, Pune but due to technical reason it was not in working position. So I went to opposite Bank of India, Laxmi Road ATM. When I tried to withdraw Rs.3300/- from that ATM it declined saying insufficient balance when I checked with security guard there he informed me that there are only 500 rs. notes available so you withdraw in multiples of 500 only.

So I withdrew Rs.3500/- (ATM 40091 BOI LAXMI ROAD II PUNE MHIN). When i checked today my account it is showing TO TRANSFER INSUF BAL ATM DECLINE CHARGE – ****** Transfer to ******14906 Rs.17/-. Will you please explain me the reason behind this charges.

Here is one more experience you should read where the bank had charged a customer for no mistake!

My friend once had a bad experience with SBI credit card. During some emergency, using his SBI Credit card he wanted to withdraw Rs.10000 from an SBI ATM. He entered Rs.10000 but the ATM refused to dispense that amount and gave a message that it could dispense only 40 notes at a time. Unfortunately only Rs.100 were present in the ATM (This point was not mentioned any where). So, he had to use his card thrice to get the required amount (Rs. 4000 X 2 times and Rs.2000 X 1). After he got his credit card statement, we were surprised to see that he was charged, cash withdrawal charges – 3 times (Rs.250 X 3 = Rs.750). Had the ATM been filled with Rs.1000 notes, the transaction would have been only one and my friend could have saved Rs.500. Is this ethical to charge the customers for such things? (Source)

Have you been charged for Failed ATM transaction due to insufficient balance at some other bank ATM ? Do you feel its justified?