Federal Bank has signed an agreement with Life Insurance Corporation of India for paying maturity proceeds of LIC policies.
Hitherto the maturity proceeds were paid by cheques from the respective branch offices of LIC across the country and sent to the beneficiaries one month prior to the due date. Now the proceeds will be credited directly to the beneficiary's account by way of NEFT (National Electronic Funds Transfer) on the due date. This move will be cost effective for LIC and improve the payment system.
Clients need not wait for the cheque to get cleared as the payment is credited directly into the account. Problems such as cheques getting lost in transit, fraudulent encashment, and so on, will not arise.
Federal Bank is among the few banks which have signed agreements with LIC as the bank has systems in place to ensure that NEFT payments from each Divisional Office, numbering to more than 10,000 daily, can be sent smoothly.
Mr Antu Joseph, Deputy General Manager, Federal Bank, said that the alliance will create a win-win situation for all parties involved, giving the customers a hassle-free and convenient claims option.
According to Mr V. K. Kukreja, Executive Director, Finance and Accounts, LIC, “We are excited about the potential of our tie-up with Federal Bank, which is one of the leading banks with a strong focus on asset quality, excellence in banking technology and delivery of service quality.”