What changed
RBI introduced a compensation framework requiring credit institutions and credit information companies to pay ₹100 per calendar day for delays beyond 30 days in resolving credit information complaints. Banks must forward corrected data to CICs within 21 days; CICs have the remaining 9 days. Compensation is apportioned among responsible entities proportionately.
What it means for you
Banks face direct financial liability for slow credit information updates, incentivizing faster rectification. This protects customers from prolonged credit report errors that could affect loan approvals or interest rates. Lenders must tighten internal processes to avoid penalties and reputational risk.
What you must do
- Update internal complaint handling systems to track 21-day deadline for forwarding corrected credit info to CICs.
- Train staff on new compensation rules and ensure timely escalation of credit information disputes.
- Audit current turnaround times for credit information rectification and identify bottlenecks.
- Coordinate with CICs to ensure seamless data flow and compliance with 30-day resolution timeline.
- Communicate the compensation mechanism to customers in complaint acknowledgment letters.
Who it affects
All Commercial Banks (including SFBs, LABs, RRBs), Primary Urban Co-operative Banks, State/Central Co-operative Banks, Non-Banking Financial Companies (including HFCs), All-India Financial Institutions (Exim Bank, NABARD, NHB, SIDBI, NaBFID), Asset Reconstruction Companies, Credit Information Companies
What is the compensation amount for delayed resolution?
₹100 per calendar day for delays beyond 30 calendar days from the date of complaint filing.
Who pays the compensation if multiple entities are involved?
Compensation is apportioned proportionately among the responsible credit institutions and credit information companies.
What is the deadline for banks to update CICs?
Banks must forward corrected credit information to CICs within 21 calendar days of being informed of the inaccuracy.