Soon, the Reserve Bank of India will make digital banking more secure, easier, and standardized. It has just announced new rules called the ‘Digital Banking Channels Authorisation Directions-2025’. These rules will come into effect from January 1, 2026.
These guidelines will be applicable to all commercial banks, including the SBI. However, small finance banks, payment banks, and regional rural banks are excluded from the ambit. The motive behind doing so is to introduce consistency in the digital services offered, such as internet banking and mobile banking, in a more regulated way. According to experts, these norms would give strength to the Indian banking system and bring more convenience and safety for the customers.
Improving Security and Regulation
The RBI is implementing these regulations to make transactions more secure, as well as to streamline online banking channels. All digital platforms fall under the guidelines, which include websites and mobile banking apps. The RBI also estimates that digital banking users in India could rise to 80 crore by the end of 2025.
Two Types of Online Banking Services
January 1, online banking services will be divided into two categories:
- Read-only: The customers can check the account balance or read the account statements. Banks will not be liable in this mode for any fund transfer
- Transactional facility: Customers can enjoy all the banking facilities, including transfer of funds.
This categorization enables banks to offer appropriate services to customers. The new users can begin with the 'view-only' mode and later shift to transactional services, reducing chances of fraud.
Permission and Compliance
The RBI regulations have to be followed to the letter before digital channels are launched by banks. Permissions for every kind need to be taken. This might be cumbersome for banks not so sound technologically, but the RBI finds this essential for the long-term benefit of a better banking system.
Customer Rights and Safety
The RBI guidelines also provide protection to the customer rights:
- The customers should provide express consent regarding the registration or deregistration of digital channels.
- Transaction alerts by SMS or email are the best options.
- Terms and conditions shall be in clear and simple language in English, Hindi, or local languages.
- Information regarding charges, processes for dispute resolution, and stop-payment procedures shall be provided.
- By default, banks should not link their digital channels to debit cards and other services; it should be a matter of customer choice. It is designed to make digital banking safer, more transparent, and customer-friendly.
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