After certain account holders of UCO Bank received a total of around ₹820 crore in “erroneous credits” via the Immediate Payment Service (IMPS), Uco Bank on Thursday said it has blocked the recipients’ accounts and has been able to retain and recover around ₹649 crore, which is about 79 per cent of the total money.
The Kolkata-based lender observed that certain transactions initiated by account holders of other banks had resulted in credit to its account holders without actual receipt of money from these banks between November 10 and 13.
‘Internal tech issue’
Following the issue, UCO Bank has made the IMPS channel offline as a precautionary measure. The bank has clarified that the incident happened due to an internal technical issue, and there was no issue with the IMPS platform.
“We further inform that by taking proactive steps, the bank blocked the recipients’ accounts and has been able to retain and recover around ₹649 crore out of ₹820 crore, which is about 79 per cent of the amount,” UCO Bank said in a stock exchange filing on Thursday.
The bank has initiated the requisite actions to recover the balance of ₹171 crore. The matter has been reported to the law-enforcing agencies for necessary action.
Recovery
“A total of ₹820 crore was credited to our account holders, but the amount was not debited in the remitters’ accounts. As the amount was not debited, our bank did not get the money. So, our team was quick enough to swing into action and blocked the recipients’ accounts, and reversed these transactions. As the money did not flow to the bank, our customers were not actually entitled,” UCO Bank managing director and chief executive officer Ashwani Kumar told businessline.
“Certain customers have used the money also. We have reached out to those customers and told them that the money had been erroneously credited to their accounts. We have urged them to pay back. Yesterday (Wednesday), around ₹9 crore was recovered from these customers,” Kumar said, adding the bank’s team was on the field on Thursday too to contact the customers for recovery.
He said UCO Bank has reached out to other banks from where the credits originated. “It might be possible that some customers of these banks transferred the same amount of money three-four times, as the money was not debited from their accounts. If a person was to transfer ₹5,000, it might be possible that he tried to pay four-five times, resulting in the recipient getting a total of ₹20,000-25,000. But the recipient is not entitled to use the entire amount. That is why we referred the case to the investigating agencies also,” the MD said.
He said apparently the matter does not look like a hacking incident, adding, “But you never know what the exact issue was.”
After the route cause analysis of the incident and rectification, the bank would restore the IMPS services, subject to getting clearances from all agencies. “It might take three to four days or more,” Kumar added.
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Published on November 16, 2023
