Credit Card New Rule: From October 1, these 3 new rules related to credit cards will be applicable. Through this, the card holder will get better service along with security. These new rules include new restrictions related to credit card cancellation, billing etc. It also includes the rules for conducting credit and debit card tokenization.
Mumbai. In April this year, the Reserve Bank of India (RBI) had issued new norms for issuance of credit and debit cards. These new rules include new restrictions related to credit card cancellation, billing etc. It also includes the rules for conducting credit and debit card tokenization. Earlier the new rules related to debit and credit cards were to be implemented from July 1, but now the last date for tokenization has been made 30 September 2022.
From October 1, these 3 new rules related to credit cards will come into effect. Through this, the card holder will get better service along with security.
OTP based consent required
The credit card issuing bank will have to obtain One Time Password (OTP) based consent from the cardholder to activate the card. If the card has not been activated by the customer for more than 30 days from the date of issue. The card issuer has to close the credit card without any charges within 7 days after asking the customer.
Credit card limit approval
- Further, the card issuing banks shall ensure that the credit limit sanctioned and granted to the cardholder is not breached at any point of time without obtaining explicit consent from the cardholder.
- The card limit cannot be changed by the card issuer without asking the card holder. That is, to change the credit limit, customers will have to give information on behalf of the card issuer and take permission from the customer.
Rate of interest
There will be no unpaid charge/levy/tax for collection/compounding of interest on the credit card. As per RBI circular, unpaid charges/levies/taxes cannot be capitalized in terms of compounding interest. This is so that the customer does not get trapped in the credit card interest trap. Now companies will not be able to levy compounding interest on bills from October 1.
The Reserve Bank of India (RBI) has made it mandatory to replace all credit and debit card data used in online point-of-sale and in-app transactions with a unique token by September 30. By tokenizing the card, this additional layer of security will prevent fraud with the users and give them a better digital payment experience
