Master Direction has been issued by the Reserve Bank of India to the card issuing companies for the issuance of credit and debit cards. These guidelines issued on Thursday (April 21) will be applicable to all scheduled banks and non-banking financial companies (NBFCs). However, exemption has been given to Payment Bank, State Co-operative Bank and District Central Co-operative Bank.
Guidelines will be applicable from July 1:According to the new guidelines issued by IBI, now any bank or NBFC is prohibited from increasing the limit of credit card, issuing credit card or providing any other facility without the approval of the customer. If the credit issuing companies do not follow these guidelines, then double the amount of the bill will have to be paid as fine.
Along with this, IBI has given clear instructions to all the credit card issuing companies that third parties should not be used for recovery of outstanding bills from any customer and neither customers should be intimidated.
Penalty for not closing the card: According to the new guidelines, if a customer applies for credit closure, the card issuer has to close the credit card within seven days. Even if the customer has paid the outstanding bill in full, but even after this the card issuer does not close the credit card, then the company will have to pay a fine of Rs 500 per day.
If any user does not use the credit card for more than one year, the process of closing the credit card will be initiated by the card issuing company. A message will be sent to the customer before the card is closed, if he does not respond within 30 days, his card will be automatically closed after 30 days.
Along with this, the credit card issuing companies will inform the customers about different categories of interest rates through their websites and other mediums.