RBI issues twin circulars to strengthen customer services relating to credit information
– Chirag Agarwal | Executive | finserv@vinodkothari.com
Introduction:
In a world where information is power and financial well-being is paramount, credit plays a pivotal role in shaping our opportunities and choices. Your credit history is a mirror reflecting your financial trustworthiness, and it’s closely monitored by Credit Information Companies (CICs) and Credit Institutions (CIs). RBI in its Statement on Developments and Regulatory Policies released with the Bi-monthly Monetary Policy Statement 2023-24 on April 6, 2023 announced that a comprehensive framework will be put in place for strengthening and improving the efficacy of the grievance redress mechanism and customer service provided by the CICs and CIs. Additionally, it was announced that a compensation mechanism will be put in place for delayed updation/rectification of credit information by the CICs and CIs . Accordingly, RBI have introduced two comprehensive frameworks on October 27, 2023 titled “Strengthening of customer service rendered by Credit Information Companies and Credit Institutions” and “Framework for compensation to customers for delayed updation/ rectification of credit information”
While the first circular deals with strengthening of customer services provided by the CICs and CIs in relation to access and use of credit information, the other one provides for a comprehensive compensation framework where the CICs or CIs fail to address the customer requests/ complaints within a specified period of time.
The objective of this article is to underscore the key provisions of the circular and identify actionable steps that CIs should take in response.
Read more →