reserve Bank of India
The Reserve Bank of India (RBI) has started preparations to make major reforms in the country's banking system. RBI has released the draft of 238 new banking rules to the public and has sought suggestions on it till November 10. These rules can be implemented from the beginning of 2026 after public opinion and feedback from banking institutions. The purpose of these proposed changes is to increase customer security, simplify banking services and ensure accountability of banks.
RBI has said that if there is cyber fraud in a customer's account and he informs the bank about it within three days, then his liability will be considered zero, that is, the customer will not have to suffer any loss. Along with this, if banks do not take timely action in such cases, a fine of up to ₹ 25,000 can be imposed on them. This will require banks to be more vigilant regarding cyber security.
Major changes have also been made in the interest of customers in locker related disputes. If a customer's locker becomes a victim of theft or loss due to the bank's negligence or security lapse, then the bank will have to pay compensation up to 100 times the locker rent.
In the new rules, the KYC (Know Your Customer) process has been further simplified. For normal accounts, KYC will have to be done once every 10 years. This process will have to be completed every 8 years for medium risk accounts and every 2 years for high risk customers. This will provide relief to customers from the hassle of submitting documents again and again.
Customers have also been given great relief in loan related matters. Now all banks will have to adopt a uniform formula for determining interest rates, so that transparency is maintained. Also, prepayment penalty (penalty on early repayment of loan) will be completely abolished on all loans. This will enable customers to repay their loan before time without any additional charges.
A proposal has also been made to provide home banking facility to customers aged 70 years and above, that is, they will not need to go to the bank branch; Bank officials will visit homes and provide necessary services.
RBI has said that after considering the suggestions of the public and banks, all these new rules will be implemented in a phased manner between January 1, 2026 and April 1, 2026. Implementation of these changes will increase transparency in the banking sector, improve customer experience and make the banking system more responsible.
