National Payments Corporation of India (NPCI) has launched a new facility to link PAN and bank accounts in real-time on the Income Tax e-filing website. Through this new facility, now the PAN number and bank account of taxpayers can be verified immediately. The advantage of this will be that income tax refunds and government benefits will be able to reach the account directly and quickly.

According to the Economic Times, NPCI had recently issued a circular in this regard. It said that this new API facility has been specially designed for government departments. Using this API, government departments will be able to verify the name, account status, and PAN number of the account holder directly from the bank's Core Banking System (CBS). Legal expert Utkarsh Bhatnagar says that this will enable the information of taxpayers to be verified quickly and correctly on the Income Tax portal. This will not delay the refund and the possibility of fraud will also be reduced.

Systems will have to be updated
All banks will have to update their systems to adopt this new system of NPCI. This may also pose some technical challenges and cyber security concerns. Nevertheless, this move will make the digital payment system more robust and help taxpayers get quick and accurate refunds.

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