Sunday, December 10, 2017

State Bank of India announces new IFS Codes for 1300 + branches

          It has been 9 months since State Bank of India merged its associate banks and Bhartiya Mahila Bank with itself.

 In April this year, SBI merged its five associate banks - State Bank of Bikaner and Jaipur, State Bank of Patiala, State Bank of Travancore, State Bank of Hyderabad, State Bank of Mysore - and also Bhartiya Mahila Bank into itself.

          Initially it was estimated that State Bank of India would rationalise at least 1500   branches. However, as per media reports, the number of branches rationalised is between 1,000 to 1,300.

          One definitive indicator of the number of rationalised branches is the number of branches which have been migrated to new IFS Codes.

          As part of this exercise, State Bank of India  has changed the names and IFSC codes of branches located in major cities such as Mumbai, New Delhi, Bengaluru, Chennai, Hyderabad, Kolkata and Lucknow, among others.

"Some of our old associate branches are getting merged with SBI branches. When that merger happens, the IFSC codes get changed," the bank's managing director (retail and digital banking), Praveen Gupta, said. He said customers have been informed about the change in IFSC codes, but internally also the bank has mapped them to the new codes.

"Even if some payment comes based on the old IFSC codes, it will get mapped with the new codes. It will not cause any problem to any customer," he said. The bank has close to 23,000 branches.

To ensure wide publicity to these changes, State Bank of India has put up the list of branches with old and new names and IFSC codes on its website. Indian Financial System Code, or IFSC, is an 11-digit alpha-numeric code used to uniquely identify all bank branches participating in any RBI regulated funds transfer system.

The IFSC code is required to transfer money from one account to another using RTGS, NEFT or IMPS methods.

The IFS Code is hard-coded amongst a large number of Non-Banking Applications, as this is the main identifier to route monies to the targeted bank accounts.

The IFS Code is also printed on the account holder’s cheque books. This acts as an authentication tool for the entities wishing to map the account holder details in their Payment Application.  Hence, it is common to attach a cancelled cheque leaf with an application form to seed the bank account in a Payment Application.

There will be minimum convenience to account holders as already State Bank of India has made internal arrangements to credit the account holder even if the Payment Instruction is received with an old IFS Code. However, where the account holders wishes to register a new Payment Instruction, it is advisable for him/her to obtain a new cheque book highlighting the changed IFS Code.

1,000 branches rationalised post the merger of associate banks, says SBI Deputy MD