Compensation of Rs.100 per day shall be paid by Credit Institutions and CICs for delayed updation/rectification of credit information

The Reserve Bank of India Thursday (October 26, 2023) released the framework for compensation to customers for delayed updation or rectification of credit information by credit institutions (CIs) and credit information companies (CICs).

The compensation framework will come into effect six months from the date of this circular, the Reserve Bank said and directed CICs and CIs to put in place the necessary systems and processes to implement the compensation framework within this period.

The RBI further said the date of the resolution of the grievance shall be the date when the rectified Credit Information Report has been sent by the CIC or CI to the postal address or email ID provided by the complainant, the circular read.

As per RBI circular, complainants shall be entitled to a compensation of ₹100 per calendar day in case their complaint is not resolved within a period of thirty (30) calendar days from the date of the initial filing of the complaint by the complainant with a CI/ CIC. The compensation amount will be credited to the bank account of the complainant within five working days of the resolution of the complaint, the RBI said.

“Credit Institutions shall pay compensation to the complainant if they have failed to send updated credit information to the CICs by making an appropriate correction or addition or otherwise within twenty-one (21) calendar days of being informed by the complainant or a CIC,” it said.

Similarly, a Credit Information Company (CIC) shall pay compensation to the complainant if the CIC has failed to resolve the complaint within thirty (30) calendar days of being informed by the complainant or a CI, despite the CI having furnished the updated credit information to the CIC within twenty-one (21) calendar days of being informed by the complainant or the CIC, as per the framework.

The complainant shall be advised by the CI/ CIC of the action taken on the complaint in all cases, including the cases where the complaint has been rejected. In cases of rejection, the reasons for rejection shall also be provided by CI and CIC.

According to the framework, where the grievance or complaint involves inaccurate credit information provided by more than one CI, the complaint will be registered by the complainant with the concerned CIC, which will coordinate with all the CIs concerned and furnish the complainant with a comprehensive resolution of the grievance.

The compensation to be provided by the CICs/ CIs to the complainant (for delayed resolution beyond thirty (30) calendar days of filing the complaint) shall be apportioned among the CIs/ CICs concerned proportionately.