I hope that @Aswin_Benny is aware of the topic I am posting about, as he is the only person I am acquainted here with from my home state of Kerala. This topic has been circulating on local news channels and in newspapers for the past week, and it has suddenly gained widespread attention, causing panic and distress.
Imagine running a small retail shop and receiving 10 Rs payment via UPI, yes you heard it right, a mere 10 rupee. The following day, you discover that your account has been frozen and all the hard earned money is stuck in it. When you inquire with your bank, they direct you to file a complaint with the cyber police. Upon doing so, you learn that the customer who paid you the 10 rupees is facing a case in another state, and the police department has instructed the bank to freeze their accounts. This may sound like a fairy tale, but it is a true incident that occurred here in Kerala.
You can read the articles related to the issue here:
As this matter has become widespread in our area, numerous shop owners are now discouraging customers from using UPI + QR code payments. In 90% of these cases, the primary ‘culprit’ responsible for account freezing is Federal Bank (as always ). One can easily find numerous complaints from Jupiter account holders also regarding account freezing on Twitter as well as in the community.
It raises the question of why this issue only occurs with Federal Bank and its affiliated partners? @Shawnpinto
Yes. Almost 99% of the frozen account I have come accross belongs to federal Bank. This is one reason why people in other communities don’t recommend Fi or jupiter anymore .
(I use fi and jupiter less these days because of these news😅. Went to aubank and kotak811.)
Yes. People are concerned about this in other communities too. The article mentioned mostly about the Kerala based banks and federal Bank head office is within Kerala. Hope jupiter partners with some other banks too like Indusind which provides greater flexibility to provide better service to its customers.
Out of the same fear, I closed down my Fi account and using only jupiter. Having come across the accounts frozen on community, I too have shifted majority of the funds to traditional bank accounts and reduced the balances I maintained with Jupiter before.
Why IndusInd provides more flexibility
Customised account numbers. This can attract customers for onboarding to jupiter.
Better interest rates. Both on savings and deposits.
@Pratyay_Mustafi Not sure whether this issue can overcome by having current account instead of personal savings account. Most of the small scale traders are unaware of current account and as you mentioned, they continue to use their savings account for business purpose.
@Aswin_Benny I recently closed my Fi account since it was inoperative for many months and was no longer interested to have it.
@specter Apart from Federal Bank, South Indian Bank is also a Kerala based bank. But didn’t hear anyone complaining their account freezing issue.
Unfortunately, my area falls under Rural Category and none of the above mentioned banks like AU Bank, Kotak811 or IndusInd bank is not serviceable in my locality. Even IDFC bank is not serviceable for my pin code.
Yes, my friend’s account was frozen by Jupiter without any reason even though my friend was not doing any transaction. Since then I am afraid to use Jupiter account.
@razack Read the articles and it seems when bank accounts are seeing an unusual increase in the number of transactions, law enforcement authorities are flagging them. Some of the experiences shared by the people affected by the unilateral decision taken by the authorities, especially the cops, were gut-wrenching. Fortunately, I or none of my employees who have a salary account with Jupiter have been impacted and I am hoping that none of us including the folks here in the community have to go through that experience.
I already hold a premium savings account and current account with them. They are most flexible. I hope they will build something like Jupiter where we can really categorise our expenses.
The payroll is processed by th owner of my company and prefers to be in control of everything that gets paid. Hence, he individually adds the employee account numbers as payee. We run into issues with payee not getting added or 4 a day limit on the number of payees that can be added. This becomes an Issue when a new batch of employees joins. While processing salaries, there seems to a cap on the number of payees that can be paid in a day.
@Dinesh_Gupta, let’s hope that the account holder didn’t have a significant amount of money in their account.
As @Pratyay_Mustafi pointed out, having hard-earned money stuck in an account for no apparent reason can be incredibly frustrating and stressful. It’s worth noting that one trader who faced this same issue of account freeze had approximately 3 lakhs saved for his house construction purpose. Just think about the emotional distress they must have gone through.
Most of the frozen accounts mentioned in the news articles are regular Federal bank savings accounts (nothing related to neobanking). That’s why I pointed out the case of South Indian Bank.
). One can easily find numerous complaints from Jupiter account holders also regarding account freezing on Twitter as well as in the community.
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