Banks, NBFCs To Face Stricter Oversight On Dark Patterns Under RBI Rules

The Reserve Bank of India (RBI) has brought dark patterns in financial services under closer regulatory scrutiny as part of its revised framework governing the advertising, marketing and sale of financial products and services by regulated entities.

The central bank, on June 15, issued the final directions which will come into effect from January 1, 2027.

In its press release, RBI has mentioned that the draft directions had proposed comprehensive instructions on the advertising, marketing and sale of financial products and services by banks and non-banking financial companies (NBFCs), covering areas such as Direct Selling Agents (DSAs), Direct Marketing Agents (DMAs), prevention of mis-selling and dark patterns.

Dark Patterns Under Focus

Dark patterns are design features employed on websites, mobile apps and digital platforms to nudge users into making decisions they might not have intended. These can include making it harder to opt out of a service, drawing attention to one option over another, and confusing prompts to make a purchase and/or sign up.

With financial institutions increasingly relying on online channels to acquire customers, regulators have been paying closer attention to how products are presented and marketed.

Responsibility Rests With Regulated Entities

The revised directions take a principle-based and channel-agnostic approach and shift the onus from the regulator to regulated entities for the advertising, marketing and sales activities they undertake, either directly or via third parties.

The new guidelines will hold banks and NBFCs responsible for all practices they introduce to customers via both digital and physical channels, including practices adopted through outsourcing and marketing partners.

It also extends to a broad range of entities involved in customer acquisition and promotion, including digital intermediaries.

Effective From January 2027

RBI has taken into account the feedback received from stakeholders in the process of finalising the amendments. The new regulations will come into effect on January 1, 2027.

While the central bank has not separately outlined specific restrictions on dark patterns in the press release, their inclusion within the new framework signals that customer-facing digital practices will be subject to greater scrutiny as part of the broader regulatory approach to responsible business conduct in financial services.