Mega bank mergers are going to come into effect in the country from April 1. 10 public sector banks will be merged and only 4 banks will be left. Under this mega merger, Oriental Bank of Commerce and United Bank of India will be merged with Punjab National Bank (PNB), Syndicate Bank with Canara Bank, Andhra Bank and Corporation Bank with Union Bank of India and Allahabad Bank with Indian Bank.
Notifications have been issued by the Reserve Bank regarding the same. The notification said that from 1st April 2020, all branches of Allahabad Bank will serve as branches of Indian Bank. Similarly, branches of Oriental Bank of Commerce and United Bank of India will serve as branches of Punjab National Bank (PNB), branches of Syndicate Bank as branches of Canara Bank and branches of Andhra Bank and Corporation Bank as branches of Union Bank of India.
Some bank branches may be closed due to merger of banks. This can happen in a situation where the merging banks and main bank branches are nearby.
Can change IFSC and MICR codes
The undertaking of banks that merge is transferred to the banks that acquire the banks. This includes entire business, assets, rights, titles, claims, licenses, clearances, etc. and other privileges and all properties, all belongings , liability and obligations. It is highly likely that ifsc codes, branch codes and MICR of branches of merged banks may be replaced.
Changes in checkbook and passbook
If the banks that are about to merge, their checkbook may be cancelled. Also, ifsc code, branch code can be changed. Even after the merger of 6 associate banks with SBI in 2017, those 6 banks had changed their cheque books, IFSC codes, branch codes, etc. The old chequebook was cancelled and the new chequebook was issued. However, after the merger is implemented, the old chequebook remain valid for a fixed time and the customer is given a certain time to change them. Changes are also possible in the case of passbooks.
No FD, RD rate changes
The banks which have been merged after the introduction of mega margins also have the deposit rate/deposit rate of the main bank i.e. Lending Rate/Rate RD rates will apply. However, customers who already have fixed deposits will continue to receive the same interest rate at which the FD is opened till the maturity period is over. The same will remain in the case of RD. The current interest rate for home loan customers will remain intact until the new entity changes the interest rate.
Change in account number, customer ID
Customers of merged banks can get a new account number and customer ID, according to the main bank. There is also scope for change in the case of ATMs, net banking, etc.
What do customers do?
If you’re a customer of banks that are about to merge, make sure that your email address and mobile number are updated with the bank. This will benefit you from getting information about any changes in the bank immediately.
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