New Credit and Debit card rules of RBI
These new guidelines will come into effect from July 1, 2022.
There are many important things in terms of the well-being of the customers and the functioning of the banks in this new rule.
According to RBI's new guidelines, the interest rate and charges on the card must be shown on a single page. Customers will be informed of the reason for rejection of their card application, and when card terms change, customers will be notified.
If the card is supplied without being asked for, the individual will be refunded twice the amount. In addition, banks will be allowed to provide customers with card fraud insurance and will not issue or upgrade cards without the customer's consent.
If the card is used without permission, the bank, not the cardholder, is responsible for the loss. Also, to activate the card, an OTP-based system is necessary. If the card has not been activated after 30 days, the bank will close it without further delay.
It is also in the rules that telemarketers of banks will not be able to harass customers unnecessarily. Conditions must be made clear in the case of EMI of the amount spent on the card, and no zero interest rate will be applicable in any way on charging interest.
It will be necessary to provide an example to demonstrate how the interest rate will be calculated. Transaction information in co-branded cards is not shared with the partner. In the advertising of the co-branded, the issuing bank's name must be prominent. If a transaction is flagged as 'fraud,' it will not be charged until the problem is remedied. If a refund or money from a failed transaction is received, it will be adjusted right away.
Before notifying CIBIL of the default, give the consumer seven days, said the bank. Before reporting defaults to rating agencies, banks should do their investigation. The recovery agencies will be required to observe the Fair Practice Code by the banks.
Apart from all this, it is less difficult to close a credit card. According to RBI, the card must be closed within 7 days of receiving the application for closure. Failure to close within 7 working days may result in a penalty of Rs 500 per day. The procedure of canceling the credit card will also require extra resources. more