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Informist, Monday, Jul. 21, 2025

 

--RBI releases draft norms on digital banking channels authorisation

--RBI:Seek comments on digital banking channels authorisation draft by Aug 11

 

NEW DELHI – The Reserve Bank of India Monday released a draft master direction on digital banking channels authorisation. The banking regulator has sought comments and feedback on the draft norms by Aug. 11.

 

According to the draft norms, both commercial and co-operative banks need to put in a comprehensive policy for all digital banking channels, in line with statutory and regulatory requirements, including on liquidity management and operational risks. Oversight and management of risks from these channel shall be with the senior management, per the draft norms.

 

The draft master direction lays out eligibility criteria for providing view-only banking facility in the digital mode and for providing a transactional banking facility to customers. Transactional banking will only be allowed with the express permission of the central bank, per the draft norms. It also compiles prior circulars and directions on technological issues in digital banking.

 

According to the draft norms, the RBI's master direction on digital payment security controls shall apply to select urban co-operative banks identified by the central bank's Department of Supervision, and chapters three and four--relating to internet banking security and mobile payments application security--shall apply to all banks not currently covered. The regulator also intends to extend compliance with risk management circulars on cybersecurity and technology use to regional rural banks and local area banks offering banking services over digital channels.

 

In addition to following applicable legal norms and Know Your Customer directions, banks must also get customers' explicit consent to engage in digital banking and cannot make it mandatory for them to opt in to the digital channel for getting facilities such as debit cards. When conducting digital banking operations, banks shall put in appropriate risk mitigation measures. 

 

"Third-party products and services, including those of promoter groups or bank group entities (subsidiaries/joint ventures/associates), shall not be displayed on banks' digital banking channels except as specifically permitted by the Reserve Bank from time to time..." the draft norms state. The master directions moot repealing 16 other directions and circulars.  End

 

Reported by Aaryan Khanna

Edited by Rajeev Pai

 

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