RBI Proposes New Amendments to Boost Customer Protection in Digital Banking

The Reserve Bank of India has issued draft amendment directions to enhance customer liability protection in digital transactions. The amendments aim to protect users and expedite complaint resolutions related to fraudulent transactions. Feedback is invited, with a compensation mechanism proposed for small-value fraud cases.

In a move to bolster consumer safety, the Reserve Bank of India (RBI) unveiled draft amendments aimed at strengthening the rules around customer liability in digital transactions.

The amendments, announced during the February monetary policy, propose enhanced protections and faster resolutions for users facing fraudulent electronic banking transactions.

The RBI has called for public feedback by April 6, 2026. Key proposals include a compensation mechanism for minor fraud, enforced for a year, as RBI seeks to shift more compensation responsibility to banks.