RBI brings new credit, debit card rules, penalties! Check latest update

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New Delhi: The Reserve Bank of India (RBI) has introduced a new set of rules related to debit and credit cards, overhauling the existing guidelines for banks and non-banking finance companies (NBFCs). The RBI has noted in its order that the new guidelines are applicable from July 01, 2022.

RBI has also introduced penalties to be levied on banks and NBFCs in case of non-compliance with the new guidelines. For instance, a penalty will be levied on banks for issuing or upgrading credit or debit cards of customers without their consent.

RBI has permitted banks to undertake credit card business, provided they have a net worth of Rs 100 crore. Such banks can undertake the business either on their own or in partnership with other card-issuing banks or NBFCs.

RBI has also allowed Urban cooperative banks (UCBs) with a minimum net worth of Rs 100 crore to set up credit card businesses after taking approval from the regulator. However, such UCBs should have a core banking platform. Also, UCBs are not allowed to issue co-branded credit cards, RBI noted.

Also, Regional Rural Banks (RRBs) with a net worth of Rs 1000 crore are now allowed to issue credit cards in collaboration with their sponsor bank or other banks.

In a directive, RBI also noted that NBFCs with a minimum net worth of Rs 100 crore now can issue credit cards after taking prior approval from the central bank. “Without obtaining prior approval from the Reserve Bank, NBFCs shall not issue debit cards, credit cards, charge cards, or similar products virtually or physically,” RBI said. Also Read Atal Pension Yojana: Govt transfers Rs 5000 to account every month; here’s how to avail benefits

The lender also noted banks shall provide options for disabling or blocking the form factor through mobile banking, internet banking, SMS, IVR, or any other mode. Also Read: Elon Musk says he has $46.5 billion in financing ready to buy Twitter

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