RBI Issues Draft Norms on Digital Banking Channels

The Reserve Bank of India (RBI) released draft guidelines titled “Digital Banking Channels Authorisation” to regulate how banks offer digital banking services. These norms aim to safeguard consumer choice, ensure explicit consent, and enhance transparency in the digital banking ecosystem.

Key Highlights of the Draft Norms

No Mandatory Digital Opt-In

• Banks cannot compel customers to opt for digital banking channels as a precondition for availing other services.
• Customers must retain the right to choose whether they want access to online/mobile banking or similar services.

Explicit Customer Consent

• Digital banking services can only be activated with clear, documented consent from the customer.
• Banks must maintain a record of such consent for compliance and audit purposes.

Mobile Number and Email Usage

• Banks may continue to collect and store mobile numbers and email IDs as part of KYC norms when accounts are opened.
• However, this should not be confused with giving consent for digital banking.

Alerts and Notifications

• Banks must inform customers clearly that SMS/email alerts (for both financial and non-financial transactions) will be sent to the registered contact details.

Significance of the Norms

• Empowers customers with freedom of choice in banking access.
• Prevents bundling or forced digital migration, especially important for senior citizens and non-tech-savvy users.
• Enhances accountability of banks by requiring documented consent and proactive communication.
• Aims to strengthen data privacy, reduce mis-selling, and foster inclusive banking practices.

The Indian Express