RBI issues norms for internal ombudsman in banks, NBFCs

Mumbai, The Reserve Bank on Wednesday issued guidelines for the appointment and functioning of internal ombudsman in banks and NBFCs with an aim to strengthen the mechanism for resolution of customer grievances within regulated entities.

The Reserve Bank of India (RBI) has issued separate directions for commercial banks, small finance banks, payments banks, non-banking financial companies, non-bank prepaid payment instrument issuers, and credit information companies.

The directions, the RBI said, have been issued with a view to strengthen the internal grievance redress mechanism within regulated entities and ensure a speedy and meaningful resolution of customer complaints by enabling a review by an apex-level authority within the entities.


The internal ombudsman (IO) should either be a retired or serving officer, in the rank equivalent to a general manager in the RE having necessary skills and experience of minimum seven years of working in areas such as banking, non-banking finance, regulation, supervision, payment and settlement systems, credit information or consumer protection.

Every regulated entity should appoint at least one IO, the RBI said.

The office of the IO will not handle complaints received directly from the complainants or members of the public, it said.

It should deal with the complaints that have already been examined by the regulated entity but have been partially resolved or being wholly rejected.

"The areas relating to customer service and customer grievance redress, as well as the implementation of these directions, shall be a part of the supervisory review by the Department of Supervision of the Reserve Bank," the central bank said.