What Happens To Your Account When Two Banks Merge

The Reserve Bank of India (RBI) has given the green light to Saraswat Co-operative Bank, India's largest co-operative bank, to merge New India Co-operative Bank (NICBL) with itself. The merger will take effect from August 4. Saraswat Bank will absorb all assets, liabilities, and customers of NICBL from that date. Though top officials at Saraswat Bank refused to speak on the matter, the move puts into relief what such mergers will do to ordinary bank customers.

This is what you can look forward to when your bank merges with another:

Account Numbers And IFSC Codes May Change

One of the earliest things that may change is your account number or IFSC code, particularly if you are a customer of the bank undergoing merger. This may affect the manner in which you get money, transfer, or pay EMIs, if your existing details are obsolete.

If that occurs, customers will generally be notified beforehand. You might need to revise this information wherever you've stored it, such as salary accounts, SIP instructions, or bill payments.

You Might Receive New Cards And Cheque Books

Your debit and credit cards made by the bank taking over might be replaced over a period. The new bank might issue substitute cards and cheque books. Card PINs and UPI IDs might have to be renewed as well. Such changes typically involve a notice period, and customers are allowed to use existing cards till the date. 

Loan Terms Typically Remain The Same

Unless you are switching from the merging bank to a different bank's loan product or category, your loan contract is effective. The interest rate, EMI value, and tenure in general remain unchanged unless the new bank decides to alter terms subject to certain conditions.

Still, it is worth asking your branch or relationship manager whether any paperwork or re-verification is required after the merger.

Deposit Rates May Vary Slightly

Fixed deposits and savings accounts could experience a rate revision, particularly if the acquirer bank operates on a different rate structure. Typically, existing FD rates do not change till maturity, and then the new bank's terms kick in.

If your FD was in NICBL, the rates of Saraswat Bank will apply once they are renewed.

Branch Access And Staff Might Change

Some branches will be merged, shifted, or closed down if the two banks had branches in the same location. Customers can be transferred to a nearby branch and in certain instances, familiar staff also.

This might impact offline services or support in the branch. Be on the lookout for formal communication from the bank with fresh branch information.

You May Need To Switch Digital Platforms

Net banking and smartphone apps can be altered, particularly if the two banks operated with different systems. NICBL customers might ultimately be transferred to Saraswat Bank's online platforms. This might include creating a new login, registering a mobile number, or mastering a new app interface. The bank can provide assistance through helplines or even branch visits to make it convenient.

What You Should Do

If you are a customer of NICBL, here are a few things to look out for:

• Be aware for official announcements by Saraswat Bank

• Update all saved account or payment information

• Download and register for the new bank's mobile app if necessary

• Seek clarification on your loans, deposits, and charges for services

Most importantly, don't panic. RBI rules guarantee your money and services are safe during a merger. Any changes, if at all, are brought about in a phased and consumer-friendly way.