RBI proposes compensation for delay in correction of credit reports

The Reserve Bank of India (RBI) has proposed to put in place a compensation mechanism for delayed rectification of credit information.

With the increase in customer complaints regarding credit information reporting and the functioning of credit information companies (CICs), the RBI has been decided to put in place a comprehensive framework for strengthening and improving the efficacy of the grievance redress mechanism and customer service provided by the credit institutions (CIs) and CICs.

This comes after Credit Information Companies (CICs) were recently brought under the purview of the Reserve Bank Integrated Ombudsman Scheme (RB-IOS).

The RBI also proposed to put in place a provision for SMS or email alerts to customers when their credit information is accessed from Credit Information Companies. The banking regulator also suggested a timeframe for ingestion of data received by CICs from Credit Institutions.

The central bank also asked for disclosures relating to number and nature of customer complaints received on the website of CICs.

These measures will further enhance consumer protection, the RBI said, adding that detailed guidelines in this regard would be issued shortly.

Pre-sanctioned credit through UPI

The RBI also proposed to expand the scope of UPI by enabling transfer to or from pre-sanctioned credit lines at banks, in addition to deposit accounts. In other words, UPI network will facilitate payments financed by credit from banks.

This, according to RBI, can reduce the cost of such offerings and help in development of unique products for Indian markets.

RBI to set up portal for unclaimed deposits

The RBI has decided to develop a new centralised web portal to enable search across multiple banks for possible unclaimed deposits that are older than 10 years. The search results will be enhanced by use of certain AI tools.

The deposits remaining unclaimed for 10 years in a bank are transferred to the Depositor Education and Awareness (DEA) Fund maintained by the Reserve Bank of India.

Fortune India earlier this week reported the total amount of unclaimed deposits transferred to the Reserve Bank of India (RBI) by public sector banks (PSBs) in respect of deposits, which have not been operated for 10 years or more, stood at ₹35,012 crore. State Bank of India (SBI) had the highest amount of unclaimed deposits at ₹8,086 crore, followed by Punjab National Bank (PNB) at ₹5,340 crore and Bank of Baroda at ₹3,904 crore.