1 week ago
RBI Orders Banks to Improve Customer Transaction Policies
The Reserve Bank of India found that some banks do not clearly explain how customers can make certain transactions.
Some websites mentioned important information without giving customers a direct link to it.
Other banks used vague descriptions of the documents needed to send money abroad.
The RBI wants banks to clearly explain their rules, fees, timelines and complaint procedures.
Banks must also make sure their employees understand and follow these rules.
Rohit Jain said customers should not suffer because a bank is slow internally.
He also said banks can help more international trade happen using local currencies.
This will work only if banks build reliable systems and give customers useful guidance.
RBI Deputy Governor Rohit Jain identified gaps in banks’ customer transaction policies after reviewing their websites.
Some banks lacked direct links to charges and grievance policies, while remittance documentation guidance was too broad.
The RBI told authorised dealer banks to publish clear rules on documents, charges, timelines, approvals, escalation and complaints.
Jain said policies must remain current, understandable and properly implemented, with staff training and audits.
He said local-currency trade could reduce costs, but success depends on viable corridors, competitive rates and reliable banking processes.
- Who
- Reserve Bank of India Deputy Governor Rohit Jain and authorised dealer banks.
- What
- The RBI flagged shortcomings in banks’ customer transaction policies and directed them to improve transparency and processing for cross-border remittances.
- Where
- At banks’ websites and branches offering cross-border services; the event’s location is not specified.
- When
- The concerns were discussed during Rohit Jain’s address at the Annual Day of the Foreign Exchange Dealers’ Association of India; the article does not specify the date.
- Why
- Gaps in documentation guidance, website disclosures and transaction processing could make it harder for customers to access information and complete transactions.
Key facts
- Regulator
- Reserve Bank of India
- Official raising concerns
- Deputy Governor Rohit Jain
- Problems identified
- Missing direct links, vague documentation requirements and delays in cross-border remittances
- Required bank disclosures
- Documentation, process, approving authority, charges, timelines, escalation and grievance redress
- Local-currency framework
- Special Rupee Vostro Account framework for invoicing, payment and settlement of international trade in rupees
- Conditions for success
- Commercial viability, genuine two-way trade flows, market-determined rates and reliable settlement processes
Quotes
Rohit Jain
Deputy Governor of the Reserve Bank of India
“I would encourage you not to see it only as a way of reducing reliance on international currencies. The settlement of cross border transactions in local currencies results in lower transaction costs, fewer currency mismatches, better settlement efficiency, and the ability to trade where correspondent banking is costly or constrained”
indianexpress.com
“We have found multiple documentation requirements and cases of delay in executing cross-border remittances”
indianexpress.com
Sources
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