MUMBAI: In its bid to contain the cross-selling of financial products, the RBI is planning to prohibit banks from displaying third-party products and services on their digital banking platforms. This includes offerings from promoter groups or entities within the bank's own group.
In the draft digital banking channels authorisation directions issued late last evening, the RBI said, "Third-party products and services, including those of promoter groups or bank group entities (subsidiaries/joint ventures/associates), shall not be displayed on banks' digital banking channels except as specifically permitted by the Reserve Bank from time to time."
The draft is open for public feedback until August 11.
Other key proposals include banks monitoring transactions for fraud, taking customer consent for digital banking services, and taking prior RBI approval to launch transactional banking apart from banks being asked to put in place a risk-based transaction monitoring and surveillance mechanism. These measures, the regulator said, are aimed at enhancing security and customer choice in digital banking.
The study of customer transaction behaviour patterns and monitoring unusual transactions or obtaining prior confirmation from customers for outlier transactions may also be incorporated in the systems in accordance with the fraud risk management policy of the bank, said the draft.
Banks offering mobile banking services other than through mobile applications must ensure that customers across mobile networks can avail those services, meaning the service will be network independent.
The draft said banks shall put in place appropriate risk mitigation measures in accordance with their policies, like transaction limit on a daily, weekly and monthly basis, transaction velocity limits, and fraud checks depending on their risk perception.
It further said banks should not make it mandatory for customers to opt for any digital banking channel to avail any other facility like debit cards.
"While it may be more convenient for customers to opt for some services together (like virtual access to card controls), the choice to apply for digital banking facilities shall lie solely with the customer," the draft said.
Also, banks should obtain explicit consent from the customer for providing digital banking services, which may be duly recorded/documented, it said. "Banks shall require prior approval of the Reserve Bank for launching transactional banking facility," the draft said.
Subject to fulfillment of the prudential eligibility criteria, banks may apply to the respective RBI regional office for launching transactional banking facility, along with a board resolution.
They will also have to provide supporting documents, including related to net worth as per minimum regulatory requirement or Rs 50 crore, whichever is higher, as on March 31 of the immediately preceding financial year.