- Customers will get a big relief from RBI
- ‘Masterstroke’ achieved by issuing new guidelines
- Bank will not do miss selling from 1st July 2026
RBI mis-selling rules: RBI (Reserve Bank of India)Reserve Bank Of India) have issued new draft rules to protect the interests of consumers and take action against mis-selling by banks. The draft, RBI Commercial Banks Responsible Business Code of Conduct Amendment Directive 2026, will come into effect from 1 July 2026. Under the draft, if a bank is found to have mis-sold a product or service, the bank will have to refund the full amount to the customer and compensate for any losses incurred. RBI’s new code of conduct for marketing will require express consent from customers.
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Transparency is essential when marketing or selling. According to the new rules, banks and other financial institutions will use transparency and accountability while advertising, marketing or selling any financial product or service. While explicit consent will be mandatory before contacting customers and contact can be made only during office hours, the RBI also said banks’ internal policies should not encourage employees or direct selling agents to engage in mis-selling in any way. This means that the incentive structure should not focus solely on increasing sales, even if that is not in the best interest of the customer.
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The central bank has also taken a particularly tough stance on the sale of third-party products and services. The draft states that employees involved in marketing or selling such products should not receive any incentive directly or indirectly from the third party concerned. Furthermore, no bank shall be allowed to forcefully link a third-party product with its own product (tie-in sales). Consumers will be given the right to freely choose from different options from different companies.
Disclaimer: This is an automated news feed of Navrastra newspaper. That navarashtra.com Not edited by staff.
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