Cashless transactions are now an accepted (and hygienic) mode of payment in this post-pandemic world. When you need to send or receive money quickly, bank transfers are generally fast, reliable and safe.
The advent of PayNow has also allowed people to transfer funds to others by using either phone or NRIC numbers. In September 2019, 2.8 million individuals have already registered for PayNow, while the number of transactions via the platform reached over 5 million in 2019. Increasingly, bank transfers and mobile transfers have taken over traditional methods of money transfer such as cash or cheque deposits.
However, mistakes can happen when transferring funds. One such common mistake is to enter the wrong phone or account number, resulting in the transfer of money to someone else instead of the intended recipient.
While the error can be costly and time-consuming to reverse, it is still possible to do so. There are safeguards in place to help users from erroneous transactions which include the E-Payments User Protection Guidelines by the Monetary Authority of Singapore (MAS), which spell out the responsibilities and liabilities of both the user of e-payments and financial institutions that provide such facilities, such as banks and firms with stored value facilities.
In the case where you have transferred your money wrongly to someone else, you should take the steps below.
Read Also: What Is PayNow And 3 Reasons To Register For It If You Have Not Done So
#1 Contact Your Financial Institution
In the event you are unable to contact the recipient or the recipient is unwilling to assist you, you should quickly contact your financial institution for assistance. They will get in touch with the recipient.
Banks will also require you to fill out recall forms or requests.
According to the MAS E-Payments User Protection Guidelines, account holders should provide the following information to their financial institutions when lodging a report:
- The affected account;
- Account holder’s identification information;
- The type of authentication device or access code used to perform the transaction
- Name or identity of any account user of the account;
- Recipient’s unique identifier, such as account number, identification number or other credentials entered by the account holder;
- Date, time, amount and purpose of the erroneous transaction.
According to the guidelines, financial institutions (i.e. banks) should take reasonable effort to recover the sum sent erroneously. This includes:
- Informing the recipient’s bank of the erroneous transaction within 2 business days
- Following up with the recipient’s bank for the recipient’s response within 7 business days
- Alerting the account holder to new information to allow the account holder to assess if he needs to make a police report about the transaction.
If the recipient is based overseas, or sufficient information was not provided at the point of reporting the case, this process may take longer. As many people do not check their bank statements or balances, it may take a while for the recipient to be alerted and the money to be returned.
Do note that while financial institutions will try their best to recover the funds on your behalf, they are unable to reverse the transactions instantly. As the financial institution is a facilitator of the transaction, they are not expected to resolve the erroneous transaction claim, and they will need to seek the consent of the recipient of funds for the reversal to happen.
#2 Reach Out To The Recipient Directly
If you know the recipient in person, you can probably contact them and have them reverse the funds to you. However, if you do not know them in person, this may not be a good idea since, from the recipient’s perspective, this could be part of a scam or money laundering scheme.
Additionally, you should not harass them into returning the funds to you.
Read Also: PayNow vs Pay Anyone vs PayLah: What’s The Difference – And Which Should You Use?
#3 Seek Legal Recourse
If the recipient refuses to return the money, you may seek legal recourse by lodging a police report on the possible wrongful retention of the money.
According to the Penal Code, the retention or use of monies transferred erroneously, where the receiver has been informed of the wrongful transaction, is an offence that can attract a jail sentence, a fine, or both.
In 2019, a private hire driver was sentenced to jail for three months for misappropriation of monies that was mistakenly transferred to him. The money, which was meant to be paid to a vendor by a ride-hailing company, was wrongly transferred to the driver who then used the amount to pay his son’s school fees, personal bills and other transactions.
Read Also: What To Do If You Lose Your Wallet Or Purse In Singapore?
What You Should Do If You Received Monies Wrongly
On the other hand, if you happen to receive money wrongly from an unknown recipient, you should immediately contact your bank to determine the source of funds, and to request for the funds to be returned by the bank. If you know the person or the company that has wrongly transferred the money to you, you should contact them directly to reverse the transaction.
If it is not someone you know, it is best to get the banks involved. However, you should never spend or retain the money sent to you by mistake.
Read Also: How Money Laundering Works – And How To Avoid Become An Unwitting Participant Who Is Breaking The Law
Always Exercise Care When Transferring Monies
The best way to prevent this costly mistake is to exercise care when making transfers. Be sure to verify with the intended recipient the information provided. Also, double (or triple) check that you have entered the correct bank account or phone number and the amount before making the transfer.
Read Also: Send Money Overseas For Your Foreign Domestic Worker, Without Incurring Unnecessary Costs And Effort, With TransferWise
This article was first written on 17 September 2020, and has been updated with the latest information.
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