Thread by @2021Kashif

RBI guidelines governing the issuance and operations of credit cards became effective from Today (except 3) ✨

This thread 🧵 will act as one stop point for checking all provisions explained in simple words 👇

Let's go 🏃

[1]Applicability
- The guidelines applies to all banks except payment banks, co-operative banks and NBFCs operating in India

[2]New entry ⭐⭐⭐⭐
- Apart from banks, NBFC can also apply for Credit card issuance if Net owned fund > 100 crore & take special approval from RBI

[3]No place to hide bank policy
- Every bank has to have a well documented board approved policy
- Which should be reviewed and audited every six months

But most importantly ⭐⭐⭐

- The policy should be displayed prominently on website, so customers can also access it

[4] Improvement in Application Process ⭐⭐
- There will be a "one page key fact statement" with card application mentioning important features.
- MITC now will be sent separately with welcome kit at registered address or email as per "the choice of customer".

[5] Reason of rejection ⭐⭐⭐⭐⭐
- Every bank has to tell the specific reason which led to rejection of application.
Hope this will end the problem of "internal policy" as IMO, Internal policy is a very wide term which is combination of many rules & is very generic in nature.

[6] Issue of Unsolicited cards or upgradation ⭐⭐⭐
- Bank can't issue card or even upgrade cards without your consent. If you have to pay any fees due to such issuance/ upgradation, Bank has to :
1. Reverse the charges for any joining fees

2. Penalty of 2x charges w/o any objections
3. You can even claim compensation by complaining to RBI up to Rs. 1,00,000

So, Next time Kotak issues you card or upgrade you to high fees card without consent, paisa hi paisa hoga 😉

[7] LTF matlab LTF ⭐⭐
- Life time free card means life time free, there should not be any hidden charges what so ever.

[8] Misuse of card ⭐⭐
- In case of misuse of card before reaching to customer, all loss will be borne by card issuer.

[9] Activation of card ⭐⭐⭐⭐
- OTP based Activation of card is compulsory
- Bank can't report it to CIBIL before such activation
- If card is not activated within 30 days or customer refused to activate card, Bank has to close card within 7 days w/o charging any cost.

[10] Statement and Payments ⭐⭐⭐⭐
- There should be no delay in sending bill statements.
- Customer must have at least 14 days for payment of bill
- No financial charges can be raised on a transaction disputed as 'fraud' until dispute is resolved.

[11] Changing billing cycle ⭐⭐⭐⭐⭐
- Cardholders shall be provided a one time option to modify the billing cycle of credit card.
Previously few banks used to refuse to do that directly.

Now managing multiple cards will become much easier with few dates to look around.

[12] Refund, reversed or failed transactions ⭐⭐⭐⭐
- Any credit amount will be adjusted against "payment due".
- Earlier, Bank used to ask you to adjust excess payment in next bill.
- Now, If you request for reversal of amt to bank a/c, it should be done in 3 working days🤝

[13] Unused Cards ⭐⭐⭐⭐
- If Card is not used for 1 year, Bank can start closure process after intimating customer
- In case of no reply from customer within 30 days, bank can close unused cards.

- Any credit balance available in credit card shall be transferred to Bank A/c.

[14] No abrupt change in charges ⭐⭐⭐⭐⭐
- Changes in any charges shall be made prospectively only after a notice of 1 month.

Not like Slice, which gives notice in less than 24 hours for changing their 3 month no cost instalment to 36% interest on instalments.

[15] Clarity in EMI transactions ⭐⭐⭐
- Before conversion to EMI, the principal amount, Interest and discount by merchant and card issuer should be clearly shown separately.

- Same bifurcation should also be sent again in card bill statement for clarity.

[16] Awareness about min amount due ⭐⭐⭐⭐⭐
- Written warning stating that "making only the min payment every month would result in the repayment stretching over months/years with compounded interest payment on your o/s balance" should be displayed in all bills prominently.

[17] Finance charges ⭐⭐⭐
- Card issuer should explain methodology of calculation of finance charges with examples for part payment of Bill.
- Part Payment at which interest free credit period benefit will not be available should be specified in billing statement

[18] 3 days grace period ⭐⭐⭐⭐⭐
- If you didn't pay your bill till due date, 3 days grace period will be still given to you after due date.
- "Past due" can be reported only if account remains unpaid for more than 3 days after due date.

[19] Closure of Card ⭐⭐⭐⭐
- Closure of a card can be done through any mode including helpline number, dedicated email ID, IVR, Internet banking, mobile app & website.

- Card should be closed within 7 working days. Instant notification through email & sms should be provided.

- In case of non-compliance, penalty of 500/day will be charged till actual closure 🥊

So, from now on, no chik-chik and chasing bank people is required to close a card. It is their responsibility now ✊

[20] Co-branded cards ⭐⭐⭐⭐⭐
- Revenue sharing between bank and co-branding partner should be indicated to cardholder and displayed on website too 😀
- Co-branding partner's role will be limited to marketing and distribution of cards & providing access for goods/services.

- Co-branding partner will have no control except for being the initial point of contact in case of grievances 😂
- No access to info related to transactions of co-branded card should be given to such partner.

Tera kya hoga Zomato, Bajaj Finserv ?

[21] Default and Recovery ⭐⭐
- 7 days notice should be given before declaring anyone defaulter
- Name and contact details of recovery agent should be given to defaulter
- Name, Email ID, Number & address of senior official of card issuer should also be provided for escalation

- Bank should not intent to humiliate publicly or intrude upon privacy of cardholder's family members, referees and friends
- There should not be threatening and anonymous calls to them.

That's all
Thanks for your time 🙌

It took me more than 10+ hours to read , summarize and write this so if you found this helpful,
Kindly 🔖 it for future references, tag your friends in comments and ❤️ and 🔁 it so that it can reach to maximum people :)

#ccgeek #rbi #bank

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