From July 1, new rules pertaining to the issuance of credit cards will be effective. The Reserve Bank of India (RBI) gave details about the rules in a notification dated April 21, 2022.
"The provisions of these directions relating to credit cards apply to every Scheduled Bank (excluding Payments Banks, State Co-operative Banks and District Central Co-operative Banks) and all Non-Banking Financial Companies (NBFCs) operating in India," RBI stated in the notification.
Banks or card-issuers must seek a one-time password (OTP) based consent from the cardholder for activating a credit card, if the same has not been activated by the customer for more than 30 days from the date of issuance, the RBI stated.
If no consent is received for activating the card, banks or card-issuers must close the credit card account without any cost to the customer within seven working days from the date of seeking confirmation from the customer, the central bank said.
In case of a renewed or replaced card, the closure of an inactivated card will be subject to payment of all dues by the cardholder, according to the RBI.
Any request for closure of a credit card must be honoured within seven working days by the