RBI issues instructions on internal ombudsman rules for banks and NBFCs

Mumbai: The Reserve Bank of India (RBI) on Friday issued a master direction on internal ombudsman norms for banks and large NBFCs to harmonize the instructions applicable to various regulated entities on the internal ombudsman (IO) mechanism.

“These instructions are expected to further strengthen the IO mechanism and, in turn, strengthen the internal grievance redressal mechanism in regulated entities besides providing ease of compliance,” the RBI said in a release.

The instructions are intended to bring uniformity in matters such as time limit for raising complaints with IOs, exemptions from raising complaints with IOs, minimum qualifications for appointment of IOs and updating reporting formats. They also provide for the new post of Deputy Internal Ombudsman.

RBI said the directions apply to banks and non-banking finance companies (NBFCs), which will include deposit taking NBFCs (NBFC-D) with 10 or more branches; Non-deposit taking NBFCs (NBFC-ND) with asset size of Rs 5,000 crore and above and public customer interface.