What changed
RBI has finalized and implemented a Protected Disclosures Scheme for private sector and foreign banks, effective immediately. This extends whistleblower protections similar to those already applicable to public sector banks under the Central Vigilance Commission's mandate.
What it means for you
Private and foreign banks must now establish internal mechanisms to handle whistleblower complaints regarding corruption or misuse of office. Banks need to align their policies with the RBI scheme, which could increase compliance and reporting obligations.
What you must do
- Review the detailed scheme in the Annex to the circular and ensure your bank's whistleblower policy is compliant.
- Designate an internal officer or committee to receive and process protected disclosures.
- Communicate the scheme to all employees and ensure confidentiality and protection against retaliation.
- Acknowledge receipt of the circular to RBI as instructed.
Who it affects
All private sector banks operating in India, All foreign banks operating in India, Compliance and HR departments of these banks
What is the purpose of this scheme?
To provide a formal channel for employees of private and foreign banks to report corruption or misuse of office, with protection from retaliation, similar to the CVC scheme for public sector.
When does this scheme take effect?
The scheme is effective immediately from the date of the circular, April 18, 2007.
Are public sector banks covered by this circular?
No, this circular applies only to private sector and foreign banks. Public sector banks are already covered under the Government of India's resolution authorizing the CVC.