New credit card rules from July 1.

The Reserve Bank of India (RBI) has issued credit card rules. These regulations will go into effect on July 1, 2022.

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New credit card rules from July 1.
New credit card rules from July 1.

New rules governing the issuance of credit cards will go into effect on July 1. In a notification dated April 21, 2022, the Reserve Bank of India (RBI) detailed the rules. “The provisions of these directions relating to credit cards apply to every Scheduled Bank (excluding Payments Banks, State Co-operative Banks, and District Central Co-operative Banks) and all Non-Banking Financial Companies (NBFCs) operating in India,” RBI stated in the notification.
The RBI stated that banks or card issuers must obtain a one-time password (OTP)-based consent from the cardholder before activating a credit card that has not been activated by the customer for more than 30 days from the date of issuance.
If no consent is received for card activation, banks or card issuers must close the credit card account without charge to the customer within seven working days of seeking confirmation from the customer, according to the central bank.
According to the RBI, the closure of an inactive card will be subject to payment of all dues by the cardholder in the case of a renewed or replaced card.
The credit card issuer must honour any request for credit card closure within seven working days, subject to the cardholder’s payment of all outstanding balances. Following the closure of a credit card, the cardholder must be notified immediately via email, SMS, or other means, according to the RBI.
Failure by card issuers to complete the closure process within seven working days will result in a penalty of Rs 500 per day of delay, which must be paid to the customer until the account is closed, provided there is no outstanding in the account.
If a credit card has not been used for more than a year, the process of closing the card must begin after notifying the cardholder. If the cardholder does not respond within 30 days, the card account will be closed by the card issuer, subject to payment of all dues by the cardholder.
Following the closure of a credit card account, any available credit balance must be transferred to the cardholder’s bank account.

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