RBI has overhauled customer protection rules for Regional Rural Banks by introducing stronger fraud prevention measures, zero-liability provisions, and mandatory compensation mechanisms for eligible victims of electronic banking fraud.
The RBI has amended its Responsible Business Conduct Directions to introduce a detailed framework for handling fraudulent electronic banking transactions in Local Area Banks. The Directions define customer and bank liabilities, mandate fraud reporting systems, and establish compensation and grievance redressal mechanisms.
The amended Directions entitle customers to zero liability where fraud occurs due to bank negligence or timely reported third-party breaches. Payments Banks must also provide prompt transaction reversals, investigate complaints within prescribed timelines, and strengthen fraud prevention systems.
RBI’s 2026 amendment introduces stronger safeguards for Small Finance Bank customers, including zero-liability protection, mandatory fraud alerts, compensation for eligible victims, and stricter fraud reporting obligations.
The RBI has replaced the earlier customer liability framework with comprehensive rules governing fraudulent electronic banking transactions. The revised Directions require stronger fraud prevention systems, customer safeguards, and structured compensation mechanisms.
The RBI has amended the NBFC Financial Statements and Disclosure Directions by exempting fully owned and Government-controlled Upper Layer NBFCs from specified disclosure provisions. The amendment aligns regulatory requirements with the unique governance framework applicable to Government-owned entities while retaining existing disclosure norms for other NBFCs.
RBI has amended its NBFC Governance Directions to exempt fully government-owned and controlled Upper Layer NBFCs from specified governance provisions, easing compliance while maintaining the broader regulatory framework.
RBI has removed concentration risk exemptions for Government-owned NBFCs, requiring them to comply with prudential exposure limits based on their regulatory layer while allowing existing breaches to run off under specified conditions.
RBI has amended the Scale Based Regulatory Framework by making asset size of ₹1 lakh crore the primary criterion for identifying Upper Layer NBFCs and simplifying the classification process.
RBI has amended the methodology for calculating Net Open Position and capital charge for foreign exchange risk applicable to Standalone Primary Dealers. The revised framework introduces a standardized approach effective from April 1, 2027.
