Technical Issue Causes Accidental S$132M Credit Into UCO Bank Accounts In India
A technical issue recently caused UCO, a bank in India, to credit about 8.2 billion rupees (S$132 million) into customers’ accounts by accident.
The bank immediately froze the affected accounts upon discovering the error.
Currently, they have recovered about 6.49 billion rupees (S$104 million), which is about 79% of the erroneous transfers.
India’s government has since directed state-owned banks to improve digital security following the incident.
Technical issue causes ‘erroneous credits’ into some UCO accounts in India
According to The Hindu Business Line, UCO revealed that an internal technical issue resulted in some customers receiving “erroneous credits” via its Immediate Payment Service (IMPS).
The IMPS allows immediate electronic fund transfers via mobile or internet banking, similar to Singapore’s PayNow system.
Reportedly, the error occurred between 10 and 13 Nov.
Certain transactions from account holders of other banks had apparently gone to UCO Bank accounts as a result of the glitch.
In spite of that, the UCO account holders did not actually receive any money.
“We wish to clarify that there was an issue with the IMPS platform,” UCO stated.
Consequentially, the bank has disabled the IMPS as a precautionary measure while they fix the issue.
79% of wrongly transferred funds recovered
The Indian Express reported that the bank has recovered about 6.49 billion rupees (S$104 million) out of the wrongly credited amount.
Source: Mint
This is about 79% of the erroneous transfers, noted Indian business daily Mint.
They were able to do this by freezing the recipient’s accounts, among other regulatory steps.
Additionally, UCO noted that they have already initiated requisite actions to recover the remaining sum.
Government urges vigilance & improvements to banks’ digital security
In light of the incident, India’s government has directed state-owned banks to improve digital security.
According to the Times of India, the Finance Ministry has asked the institutions to review systems and processes in their digital operations following the recent glitch.
They also urged banks to stay vigilant so that they ready in the event of a cyber threat in the future.
Also read: US Authorities Shut Down Two Banks In One Week, Combined Assets Amounted To S$428 Billion
US Authorities Shut Down Two Banks In One Week, Combined Assets Amounted To S$428 Billion
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Featured image adapted from Mint.
