The rapid development in payment technology has meant evolving from physical to digital. and while digital transactions have grown enormously complaints regarding these have also grown in tandem Consequently the Reserve Bank of India (RBI) now proposes to set up a separate ombudusman to deal with complaints regarding digital transactions.

According to the RBI’s annual report for 2017-18, there has been an increase in the number of complaints related to digital payment and prepaid payment instruments (PPIs) issued by the bank and nonbanks. The grievances relating to digital mode of financial transactions accounted for 19% of the total complaints during 2016-17 This has gone up to 28% till the end of June 2018.

Effective July 1, 2017 the banking ombudsman has been addressing complaints related to mis -selling of third party service and customer grievances and mobile banking and electronic banking issues.

The ombudsman for digital transactions will set up their offices at selected centres Although a separate ombudsman scheme for complaints relating to digital financial transactions is not existing in other major jurisdictions the growing trend and increasing complexity of such complaints along with the emergence of non-banking service providers in the digital payment space underlines the need for designing a dedicated ombudsman scheme for redressal of such grievances.

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