More Stories

Informist, Saturday, Nov. 29, 2025

 

NEW DELHI – The Reserve Bank of India Friday issued its final instructions on digital banking channels, stating a host of pro-customer norms, including the need for banks to obtain "explicit consent" from customers before providing digital banking services. The central bank also asked banks to put in place appropriate risk mitigation measures like transaction limits, transaction velocity limits, and fraud checks. 

 

"The objective of the Master Directions is to facilitate sustainable growth of digital banking services, by consolidating and updating the existing instructions on use of digital channels for providing banking services," the central bank said. The guidelines take effect immediately.

 

The RBI said banks cannot make it mandatory for a customer to opt for any digital banking channel to avail any other facility like debit cards. "While it may be more convenient for the customer to opt for some services together (for example, virtual access to card controls), the choice to apply for digital banking facilities shall lie solely with the customer," it said. "However, it is clarified that banks can continue to obtain and record mobile numbers of customers to send transaction alerts and other purposes in line with KYC (Know-Your-Customer) requirements at the time of opening the accounts."

 

The central bank also mandated that banks offering mobile banking services must ensure that customers across all network operators can access these services. The RBI also said multiple channels for registration of these services may be provided to minimise the need for branch visits and application processing time. Besides, for registration, banks must provide the terms and conditions in clear and simple language – preferably in English, Hindi, or local language, which is easily comprehensible to the customer. 

 

A key guidance by the central bank is that post the customer login, the banks can display only those third-party products which are specifically permitted for a bank to deal in. "It may be clarified here that only those products and services which are allowed to be offered to a customer through a branch customer interface (viz. banking products, flagship government schemes, financial third-party products for which a bank has distribution arrangement, etc.) may be available for a customer to view post login," the RBI said.

 

Earlier, in the draft guidelines issued on Jul. 21, the RBI had said that third-party products and services, including those of promoter groups or bank group entities – like subsidiaries or joint ventures or associates - shall not be displayed on banks' digital banking channels except if it is specifically permitted by the RBI. However, there was strong feedback to this point after which the central bank "partially accepted" the changes.

 

In its final guidelines, the RBI has also removed the requirement for banks to take prior regulatory approval before launching any new digital channel. This marks a change from the draft rules that had required banks to seek the RBI's consent for any new banking channel.

 

Regarding risk and compliance, the RBI said that banks will have to put in place appropriate risk mitigation measures in accordance with their policies, like transaction limit, transaction velocity limit, and fraud checks depending on their risk perception. "It is clarified that wherever specific requirements have been prescribed by the Reserve Bank or payment system operators (for example, NPCI, card networks like VISA, Mastercard, among others), the stricter requirements of the two shall be applicable," the central bank said.

 

The central bank also asked banks to put in place a risk-based transaction monitoring and surveillance mechanism. "Study of customer transaction behaviour pattern and monitoring unusual transactions or obtaining prior confirmation from customers for outlier transactions may be incorporated in the systems in accordance with the Fraud Risk Management Policy of the bank," it said.   End

 

Reported by Priyasmita Dutta

Edited by Tanima Banerjee

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2025. All rights reserved.