The Reserve Bank of India (RBI) on April 21 released new guidelines for the issuance of credit cards and debit cards. "These directions cover the general and conduct regulations relating to credit, debit and co-branded cards which shall be read along with prudential, payment and technology & cyber security related directions applicable to credit, debit and co-branded cards, as issued by the Reserve Bank," the RBI said. These guidelines, titled Reserve Bank of India (Credit Card and Debit Card – Issuance and Conduct) Directions, 2022, will go into effect from July 1 and are expected to streamline regulations around the debit and credit cards as they will replace nineteen existing guidelines. The guidelines introduce many new provisions such as prohibiting unsolicited issuance of cards, disallowing customer harassment by recovery agents, new requirements on transparency of interest rates, etc. Key guidelines around credit cards Who can issue credit cards? Non-Banking Financial Companies (NBFCs): Apart from Scheduled Commercial Banks (SCBs), Regional Rural Banks (RRBs), and scheduled Urban Cooperative Banks (UCBs), Non-Banking Financial Companies (NBFCs) with prior approval of the RBI can now issue cards. They will require a Certificate of Registration, apart from specific permission to enter into this business, the pre-requisite for which is a minimum net owned fund of ₹100 crores. Procedures for card issuance No unsolicited issuing or upgradation of cards, loans, or other credit facilities: The issue of unsolicited cards or upgradation is strictly prohibited. In case, an unsolicited card is issued or an existing card or credit limit is upgraded without the explicit…
