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RBI may set-up a digital payments ombudsman by March 2019

8 November, 2018 9:29 AM
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RBI may set-up a digital payments ombudsman by March 2019

The aim of the RBI's move is to reduce instances of fraud and ensure that consumer's confidence in the digital payment systems goes up

The Reserve Bank of India (RBI) may set-up an ombudsman for digital payments by March to reduce the burden on banking ombudsman because of a rising number of complaints, The Economic Times reported.

Owing to a rapid adoption of digital payments across the country, the number of complaints related to digital transactions have shot up. The central bank, in its Annual Report for 2017-18, said it was considering a plan to establish a separate ombudsman to handle such complaints.

"The increasing volume of complaints involving digital payments being received by the offices of the banking ombudsman and a large number of prepaid payment instruments issued by banks and non-bank issuers have necessitated the establishment of a separate ombudsman for digital transactions," RBI said in its report.

At present, RBI is in the process of creating a scheme for establishing offices across the country for the digital payments ombudsman, the report said.

"We could have these offices set-up by early next year. The central bank is working on creating a scheme and it should function very similar to the banking ombudsman," a banker familiar with RBI’s plans told the paper.

RBI’s banking ombudsman scheme 2006 lays down various criteria under which consumers can lodge complaints with the ombudsman. A similar structure will be drawn up for the payments ombudsman, two bankers told the paper.

RBI aims to reduce instances of fraud and ensure that consumer's confidence in the digital payment systems goes up.

"The central bank is also trying to draw up a framework to collect information on the various types of frauds that are being reported in the overall payments space,"Â a banker told the paper.

Last year, RBI issued instructions to mobile wallet issuers and non-banking payments entities to establish a publicly disclosed customer grievance redressal framework.

In a circular issued in October last year, RBI said, "(PPIs will be) designating a nodal officer to handle the customer complaints, the escalation matrix and turnaround time for complaint resolution. The complaint facility, if made available on website/mobile, shall be clearly and easily accessible."

Source: moneycontrol.com

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