This update is beneficial for taxpayers too, as it will help ensure that your income tax refund gets credited to your bank account faster than before. Until now, the tax refund process used to take about 15 to 20 days, but this duration is expected to reduce soon. The government has introduced a new facility that enables taxpayers to link their PAN (Permanent Account Number) with their bank accounts more easily.
NPCI Launches the New Facility
The National Payments Corporation of India (NPCI) has introduced a new feature related to the verification of PAN and bank account details on the income tax e-filing portal. This facility helps taxpayers in linking their PAN and bank accounts through a simplified process. As per a circular issued by NPCI on 17 June 2025, the aim is to verify PAN details, bank account status, and the identity of the account holder in real-time using the Core Banking System (CBS) of banks.
PAN and Bank Account Linking – New Circular Issued
Taking this initiative forward, NPCI has launched a PAN and Bank Account Verification API, especially for government departments. This API will enable real-time verification of PAN details, bank account status, and the name of the account holder directly from the bank’s CBS.
CBS to Be Used for Verification
According to NPCI’s circular dated 17 June 2025, this API will allow government departments to verify customer account details such as PAN verification, account status verification, and account holder name using the bank’s Core Banking System. As this is a government service, all member banks are advised to prioritise its implementation.
How Will This New Facility Help Speed Up Tax Refunds?
Experts say the new facility will instantly verify PAN and bank account details, making the income tax refund and DBT (Direct Benefit Transfer) process faster and error-free. This will reduce delays and lower the risk of fraud. Banks will need to upgrade their systems to comply with NPCI’s secure API standards, which may involve major operational changes. As a result, taxpayers will receive quicker and more accurate refunds. Additionally, this upgrade is expected to enhance system performance and reduce cybersecurity risks.