25 April 2022: The Reserve Bank of India (RBI) has released the new guidelines for credit and debit cards that will be effective from 01 July 2022. Credit card users must know the new rules that are released by the banking regulatory authority of India on 21 April 2022.
The new rules regarding credit cards are more favourable for users. Like issuing the unsolicited cards, upgrading the existing card without the consent of the recipient and closure of credit cards within seven working days are the major amendments that will hugely benefit the customer.
List of New Guidelines for Credit Card by RBI 2022:
1. Option to Change Billing Cycle
Few Credit Card issuers like HDFC Bank don’t allow to change the billing cycle for the users. But now cardholders will be given a one-time option to change the credit card’s billing cycle to their preference.
2. Complaint Reply within 30 Days
Card issuers have to verify that no incorrect bills are generated and distributed to cardholders. If a cardholder objects to a bill, the card issuer must offer an explanation and, if relevant, documentary evidence to the cardholder within 30 days of the complaint date.
3. Approval Must to Raise the Credit Limit
Card-issuers are required to get the approval of cardholders before adjusting the credit amounts beyond a cut-off of one per cent of the credit limit or Rs 5,000, whichever is lower, arising from the refund, failed, reversed transactions or similar transactions against the credit limit for which the cardholder has already made payment. Within seven days of the credit transaction, the permission must be requested via e-mail or SMS.
4. Adjust Refund Amount to Payment Due
Any credit amount originating from refund failed, reversed transactions or similar transactions before the payment due date for which the cardholder has not made payment will be adjusted to the ‘payment due’ and reported to the cardholder.
5. No Charges Till the Dispute Resolved
Transactions that the cardholder disputes as “fraud” will not be charged until the issue is resolved. This means users now don’t need to pay the charges like penalties or late fees until the dispute is resolved.
Also Read: How to Get Lifetime Free Credit Card
6. Credit Card Closer by Issuer
If users have not used the credit card for more than a year, it will be closed by the issuer. The cardholder will be contacted before the termination of the credit card. If the card user does not respond within 30 days, the card account will be closed. And, if a credit amount is remaining after the credit card is closed, the amount will be transferred to the cardholder’s bank account.
7. No Action to Recover the Dues
If users are unable to pay the due amount within the prescribed period the card issuers or their agents cannot use verbal or physical threats, harassment or humiliation at a time of debt collection. The information of the customers will be limited to the recovery agents.
8. Card Closer Requested by Issuer
If any user wants to close his /her credit card, it will be done within seven working days by the credit card issuer. The user should clear the outstanding amount before closing the account. If the credit card issuer fails to do so, it will pay a penalty of Rs 500 per day of delay to the customer.
No extra charges will be taken from the customer for the closing of his credit card account. Furthermore, cardholders will be offered a variety of channels for closing their credit card account. The channels include a helpline, e-mail, Interactive Voice Response (IVR), internet banking, mobile banking, or others.
Source: Google News & The Economic Times