The Reserve Bank of India (RBI) has sent a strong message to credit card issuers and third-party agents asking them not to resort to intimidation or harassment during recovery of dues from customers.
With regard to recovery of dues from customers, the RBI has asked the issuers to ensure that they and their agents adhere to the fair practices code for lenders.
“Card-issuers/their agents shall not resort to intimidation or harassment of any kind, either verbal or physical, against any person in their debt collection efforts, including acts intended to humiliate publicly or intrude upon the privacy of the credit cardholders’ family members, referees and friends, making threatening and anonymous calls or making false and misleading representations,” it said.
Meanwhile, RBI asked card companies not to issue unsolicited credit cards or upgrade an existing card without the explicit consent of the customer, failing which they will have to pay double the billed amount as penalty.
It also asked card issuers and third-party agents not to resort to intimidation or harassment during recovery of dues from customers. In its master directions on credit card and debit card issuance, the RBI said “the issue of unsolicited cards/upgradation is strictly prohibited”.
These directions will be effective from July 1, 2022.
It further said in case an unsolicited card is issued or an existing card upgraded and activated without the explicit consent of the recipient, the card issuer will have to reverse the charges and pay a penalty double the billed amount.
