What changed
RBI replaced multiple separate Internal Ombudsman schemes (2018 for banks, 2019 for non-bank system participants, 2021 for NBFCs, 2022 for credit information companies) with one unified Master Direction. The new framework explicitly requires the Internal Ombudsman to function as an independent, apex-level authority for consumer grievance redress within regulated entities. Existing Internal Ombudsmen continue in their roles until their tenure ends; entities not yet covered must monitor eligibility and appoint one when thresholds are met.
What it means for you
Banks and other regulated entities must ensure their Internal Ombudsman mechanism is truly independent and positioned at the highest level for complaint escalation. This integration simplifies compliance by providing a single set of rules, but also raises the bar for customer grievance handling. Lenders should review their current IO appointment, reporting lines, and operational independence to align with the strengthened framework.
What you must do
- Verify that your Internal Ombudsman is independent and positioned as the apex authority for customer grievance redress within your entity.
- If you are a regulated entity not yet covered by the earlier schemes, monitor your eligibility and appoint an Internal Ombudsman as soon as thresholds are met.
- Forward the contact details of your Internal Ombudsman and Deputy Internal Ombudsman to RBI's Consumer Education and Protection Department at [email protected], and update them promptly on any changes.
- Review your internal grievance redress policies to ensure they align with the integrated Master Direction's requirements for speedy and proper resolution.
Who it affects
All Scheduled Commercial Banks (excluding RRBs), All NBFCs, Non-Bank System Participants, All Credit Information Companies
Do existing Internal Ombudsmen need to be reappointed under the new Master Direction?
No. The RBI has clarified that Internal Ombudsmen appointed under the earlier schemes will continue to hold office until the expiry of their tenure.
What is the key change in the role of the Internal Ombudsman under this new direction?
The new framework explicitly mandates that the Internal Ombudsman be positioned as an independent, apex-level authority on consumer grievance redress within the regulated entity, strengthening the internal grievance redress system.
Which entities are now required to comply with this Master Direction?
All scheduled commercial banks (excluding RRBs), all NBFCs, non-bank system participants, and all credit information companies must comply with the direction with immediate effect.