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Informist, Wednesday, Feb. 11, 2026

--RBI issues draft norms for advertising, sales of financial products, svcs 

--RBI seeks feedback on draft fincl pdts advertising, sales norms by Mar 4 

MUMBAI – The Reserve Bank of India Wednesday released draft directions for advertising, marketing, and sales of financial products and services by regulated entities. The directions, proposed to be implemented from Jul. 1, aim to curb the mis-selling of financial products and services by banks and financial companies. 

Under the draft norms, for which the RBI has sought feedback by Mar. 4, a bank will have to put in place a comprehensive policy for advertising, marketing, and sales of its own as well as third-party financial products and services. 

The RBI has proposed that a bank ensures that its employees or agents make telephonic contacts or visits to customers between 0900 IST and 1800 IST. "Calls / visits earlier or later than the prescribed time period shall be done only when the customer has expressly given a request or authorisation to do so," the RBI said.

In cases where mis-selling of a product or service has been established, the bank will have to refund the entire amount paid by the customer and intimate the customer about cancellation of the sale, the RBI has proposed. "Further, the bank shall also compensate the customer, for any loss arising due to mis-selling, as per its approved policy."

A bank, availing the services of direct selling agent or direct marketing agent, shall maintain an up-to date list of such agents. An updated list of such agents will have to be displayed on the bank's website for reference by the members of public, the RBI has proposed.

Banks will be required to put in place a Code of Conduct for marketing and sales of financial products and services under the draft directions, the RBI said. This Code of Conduct will be applicable to the bank's own employees as well as agents.

Banks will be required to ensure that its policies and practices neither create incentives for mis-selling nor encourage employees and agents to 'push' the sale of products or services. "It shall be ensured specifically that no incentive is directly / indirectly received by the employees engaged in marketing / sales of third-party products / services from the third party," the central bank said. 

A bank will not be allowed to bundle the sale of any third-party product or service with any of its own product or service, the RBI said. In circumstances where the sale of the bank's own product or service is contingent on purchase of a third-party product or service, the customer must be provided the option to purchase the same from any other company or agent, the RBI said. 

Banks will have to set up feedback mechanisms for customers within a period of 30 days from the sale of any product or service to ensure that customers have understood the features and the risks associated with such products. "Customers can lodge complaint regarding mis-selling of a product / service with the bank within the timeline specified by the respective financial sector regulators. In cases where no such timeline has been specified, customers can lodge complaint within 30 days of receiving the signed copy of the terms and conditions / agreement."  End

Reported by Shubham Rana

Edited by Akul Nishant Akhoury

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