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RBI MPC Meeting: While the Reserve Bank of India kept its benchmark interest rate, popularly known as the repo rate, unchanged at 5.25 per cent, it signalled several significant measures to make the banking system safe and more customer-friendly. The announcements made by the central bank aim to enhance customer protection, expand credit access, and make lending easy for both bank and non-bank lenders.

RBI MPC Meeting: Central Bank Aims Safer Banking For Indian With New Measures

Amid growing financial fraud and a complicated loan process, and persistent cases of violent recovery process through agent the central bank aims to introduce three guidelines to enhance the protection of banking customers.  “For customer protection, we will issue three draft guidelines: one, relating to mis-selling; two, regarding recovery of loans and engagement of recovery agents; and three, on limiting liability of customers in unauthorised electronic banking transactions,” the RBI Governor said.

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Besides, RBI is also likely to begin compensation for victims in small-value fraud cases.  “It is also proposed to introduce a framework to compensate customers up to an amount of Rs 25,000 for loss incurred in small-value fraudulent transactions,” RBI Governor Malhotra added. 

The discussion paper is also most likely to be released by the RBI to curb rising financial frauds and improve digital safety. As per Malhota, additional authentication and lagged credits can be introduced to protect vulnerable customers like senior citizens. 

Easier Compliance Rules For NBFCs

The RBI announced that it will ease the compliance rules for certain Non-Banking Financial Companies (NBFCs), and some of these companies might not need prior approval to open more than 1,000 branches. 

“NBFCs having no public funds and customer interface, with asset size not exceeding ₹1,000 crore, are proposed to be exempted from the requirement of registration,” he said.

Financial Inclusion, Rural Banking Push

As per Governor Malhotra, the RBI is likely introduce revised guidelines in respect to key financial inclusion schemes, including the lead bank scheme (LBS), Kisan Credit Card (KCC) Scheme and the Business Correspondent (BC) model, as it has reviewed these schemes. 

RBI MPC Meeting: Low Lending Rates Helping Borrowers

The RBI, with low lending rates, aims to ease borrowing. The Central Bank on Friday said that low rates have already helped borrowers, stating that credit from all sources grew at 13.8 per cent year-on-year, compared with 11.6 per cent a year ago, as he cited the latest available data. 

ALSO READ: RBI Monetary Policy Meet: Guv Sanjay Malhotra Maintains Status Quo, Keeps Repo Rate At 5.25%

“In response to the cumulative 125 bps cut in the policy repo rate, the weighted average lending rate of scheduled commercial banks declined by 105 bps for fresh rupee loans,” Malhotra said.

While the Reserve Bank of India kept its benchmark interest rate, popularly known as the repo rate, unchanged at 5.25 per cent, it signalled several significant measures to make the banking system safe and more customer-friendly. The announcements made by the central bank aim to enhance customer protection, expand credit access, and make lending easy for both bank and non-bank lenders.
RBI MPC Meeting: Central Bank Aims Safer Banking For Indian With New Measures
Amid growing financial fraud and a complicated loan process, and persistent cases of violent recovery process through agent the central bank aims to introduce three guidelines to enhance the protection of banking customers.  “For customer protection, we will issue three draft guidelines: one, relating to mis-selling; two, regarding recovery of loans and engagement of recovery agents; and three, on limiting liability of customers in unauthorised electronic banking transactions,” the RBI Governor said.
Besides, RBI is also likely to begin compensation for victims in small-value fraud cases.  “It is also proposed to introduce a framework to compensate customers up to an amount of Rs 25,000 for loss incurred in small-value fraudulent transactions,” RBI Governor Malhotra added.
The discussion paper is also most likely to be released by the RBI to curb rising financial frauds and improve digital safety. As per Malhota, additional authentication and lagged credits can be introduced to protect vulnerable customers like senior citizens.
Easier Compliance Rules For NBFCs
The RBI announced that it will ease the compliance rules for certain Non-Banking Financial Companies (NBFCs), and some of these companies might not need prior approval to open more than 1,000 branches.
“NBFCs having no public funds and customer interface, with asset size not exceeding ₹1,000 crore, are proposed to be exempted from the requirement of registration,” he said.
Financial Inclusion, Rural Banking Pushes
As per Governor Malhotra, the RBI is likely introduce revised guidelines in respect to key financial inclusion schemes, including the lead bank scheme (LBS), Kisan Credit Card (KCC) Scheme and the Business Correspondent (BC) model, as it has reviewed these schemes.
RBI MPC Meeting: Low Lending Rates Helping Borrowers
The RBI, with low lending rates, aims to ease borrowing. The Central Bank on Friday said that low rates have already helped borrowers, stating that credit from all sources grew at 13.8 per cent year-on-year, compared with 11.6 per cent a year ago, as he cited the latest available data.
“In response to the cumulative 125 bps cut in the policy repo rate, the weighted average lending rate of scheduled commercial banks declined by 105 bps for fresh rupee loans,” Malhotra said.
 

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