Digital Banking Cannot Be Mandatory For Customers To Avail Other Facilities, Says RBI

The Reserve Bank of India (RBI) on November 28 issued final guidelines on digital banking, in which it said that banks need to obtain explicit consent from customers before providing digital banking services to them. Banks cannot make it mandatory for customers to opt for digital banking to avail any other services of the lender, such as debit cards, the RBI said.

“While it may be more convenient for the customer to opt for some services together (for example, virtual access to card controls), the choice to apply for digital banking facilities shall lie solely with the customer,” the RBI said.

Lenders will need to provide appropriate risk mitigation measures in accordance with policies such as transaction limit, fraud checks, transaction velocity limits, etc. These measures will depend on the lender’s risk perception, the RBI said.

“Study of customer transaction behaviour pattern and monitoring unusual transactions or obtaining prior confirmation from customers for outlier transactions may be incorporated in the systems in accordance with the fraud risk management policy of the bank,” the RBI said.

Additionally, banks must also put a comprehensive policy for digital banking channels in place, while accounting for all statutory and regulatory requirements. This includes those relating to liquidity management and operational risks that could arise in a digital banking environment. The responsibility and supervision for effective management of these risks remains with the senior management of banks, the RBI said.