New Delhi | Despite improvements in banking services, growing customer complaints and the surge in digital frauds continue to worry regulators. In its report “Trend and Progress of Banking in India 2025,” the Reserve Bank of India (RBI) said consumer protection, transparency and trust will remain key policy priorities.
According to RBI, the banking system becomes truly resilient only when customers are treated fairly and their complaints are resolved quickly, simply and reliably.
Tougher measures against digital fraud
With digital transactions rising sharply, cases of cyber and online fraud have increased. In response, RBI has rolled out initiatives such as:
- a principle-based authentication framework for digital transactions
- a dedicated internet domain and numbering series for regulated entities
- closer coordination with the Ministry of Home Affairs and other agencies to curb cybercrime
Banks and financial institutions have also been instructed to:
- strengthen internal controls
- deploy adequate grievance officers
- expand digital financial literacy among customers
Ombudsman system expanded
To make grievance redressal faster and more accessible, the RB-IOS, 2021 scheme has undergone a wide review. Its scope has now been extended to:
State cooperative and central cooperative banks, ensuring that rural customers too can benefit from the RBI Ombudsman system.
Stronger role for Internal Ombudsman
Under the draft Master Direction issued in October 2025, proposed reforms include:
- a two-tier complaint resolution structure
- compensation powers for the Internal Ombudsman
- permission to interact directly with customers
The goal: faster, fairer and more effective resolution of grievances.
Special drive for pending complaints
RBI has also announced a two-month special drive from January 1, 2026, to clear complaints pending with the Ombudsman for over a month, on priority.
Complaint Management System 2.0
A revamped Complaint Management System (CMS 2.0) is being developed to improve tracking, transparency and user experience — from filing a complaint to final resolution.
Tough stance on mis-selling and recovery agents, RBI has indicated upcoming measures including:
- new, comprehensive guidelines on advertising, marketing and sale of financial products
- harmonized instructions governing the conduct of recovery agents
- The objective is to curb mis-selling and prevent coercive or unethical recovery practices.
- Re-examining customer liability in unauthorized transactions
Given new digital payment patterns and evolving fraud techniques, the 2017 framework which limited customer liability in unauthorized transactions is now under review.
