Reserve Bank of India issues new rules for Credit card, to be effective from 1st July

The Reserve Bank of India (RBI) has released new rules related to credit cards, which will be implemented from 1 July 2022. The persons who use credit cards should definitely know the new rules that are released by the apex bank of India. The new rules relating to credit card make the situation on the user side hassle-free.

The new rules that will be implemented on credit cards come under RBI (Credit Card and Debit Card – Issuance and Conduct) Directions, 2022. It will be applicable to every Scheduled Bank and all Non-Banking Financial Companies (NBFCs) operating in India. However, the new rules are not applicable to Payments Banks, State Co-operative Banks and District Central Cooperative Banks.

The new rules relating to credit cards have been mentioned below. Take a look at some of the important new rules.

• A credit card holder is not liable to pay any hidden charges when a credit card is issued to him/ her.
• The card issuers cannot upgrade credit cards or enhance credit limits without the consent of the cardholder. If the credit limit of the credit card is reduced, the same shall be intimated to the cardholder.
• 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.
• 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 helpline, e-mail, Interactive Voice Response (IVR), internet banking, mobile banking, or others.
• In case a credit card is not used 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.
• If a credit amount is remaining after the credit card is closed, the amount will be transferred to the cardholder’s bank account.

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