New Credit Card Rules and Regulations

If you have a Credit Card, you don’t need to worry about carrying cash. A single swipe is all it takes to pay for any services/products. If you are a regular Credit Card user or planning to get one soon, here’s what you need to know about the new Credit Card rules set by the Reserve Bank of India (RBI).

On 1st July 2022, the apex bank issued new Credit Card rules & regulations that cover card issuance, billing, charges, and closures. These rules are applicable to every scheduled bank and NBFC operating in India.

Issuance of Credit Card:

• As per RBI’s new Credit Card guidelines, an unsolicited Credit Card or upgrade of an existing Credit Card cannot be issued without the explicit consent of the customer.
• In case a customer is offered an unsolicited card, or it is upgraded without seeking permission & he/she is billed for it, the charges must be reversed and the penalty must be borne.
• Further to this, a customer can register a complaint under the RBI Ombudsman Scheme that will enable the customer to get compensation for the expenses incurred & harassment suffered by him/her.
• In another case, if the unsolicited Credit Card issued gets misused by any other person before it reaches the customer, then customer will not be responsible for it.
• An Insurance Cover for Credit Cards must be provided that will cover liabilities in case the card is stolen, lost, or there is fraud.

Closure of Credit Card:

• As a Credit Card user, you can close the card through customer care, chatbot, or any other mode. There is no need to visit the branch in person or send a post to request for card closure and no one from the bank can insist for the same.
• Closure requests should be addressed within 7 working days. If the request is not addressed within the said timeline, the card holder must receive INR 500 per day for the delay from the bank.
• If the card is not used for more than a year, then the process of closing the card after intimating the customer is initiated.

Credit Card Interest Rates & Other Charges:

• Interest Rates & other charges should be communicated to customers upfront with illustrative examples.
• No hidden charges should be applied when issuing a free Credit Card.
• Cardholders have permission to close a Credit Card in case the card charges are modified. The closure of the card is subject to payment of all dues by the customer.

Billing on Credit Cards:

• Cardholders should get Credit Card billing statements on time as well as they should get the appropriate timeframe to pay the dues before the interest rate is charged.
• To eliminate delays in billing statements, Billing statements are sent through SMS and Email. They can also be accessed from NetBanking or Mobile Banking after seeking consent from the customer.
• Card issuers should ensure that wrong bills are not issued to cardholders.
• No charges will be levied on the customer unless the disputed fraud transaction is resolved.
• Any amount arising from failed transaction or refund prior to the payment due date for which the payment is not done by the cardholder, then it will be immediately adjusted & it shall be notified to the cardholder.

Defaulting on Credit Card Payments:

• Card issuers are required to send a seven-day notice period to a customer before reporting to the Credit Information Company that the customer is a defaulter in making Credit Card payments.