RBI extends implementation of some norms for credit and debit cards

The Reserve Bank of India vide circular dated April 21, 2022, had issued master directions for credit and debit card issuance in the year 2022. These guidelines apply to banks excluding payment banks, state co-operative banks, and district central co-operative banks. Also, all NBFCs operating in India should follow the new norms of card issuance that cover prudential, payment, and technology & cybersecurity-related directions applicable to credit, debit, and co-branded cards. As per the above said circular, the fresh guidelines will come into effect from July 1, 2022. The guidelines apply to banks excluding payment banks, state co-operative banks, and district central co-operative banks. Also, all NBFCs operating in India should follow the new norms of card issuance.

On Tuesday RBI said that “Considering various representations received from the industry stakeholders, it has been decided to extend the timeline for implementation of the following provisions of the Master Direction to October 01, 2022”.Accordingly, the timeline for implementation of the following provisions is extended up to October 01, 2022.

(i) Card issuers shall seek One Time Password (OTP) based consent from the cardholder for activating a credit card if the same has not been activated by the customer for more than 30 days from the date of issuance. If no consent is received for activating the card, card issuers shall close the credit card account without any cost to the customer within seven working days from the date of seeking confirmation from the customer.

(ii) Card issuers shall ensure that the credit limit as sanctioned and advised to the cardholder is not breached at any point in time without seeking explicit consent from the cardholder.

(iii) No capitalization of unpaid charges/levies/taxes for charging/ compounding of interest.

“The stipulated timeline for implementation of rest of the provisions of the Master Direction remains unchanged,” RBI said.