Current · Source: Reserve Bank of India · RBI/DOR/2025-26/278 · issued 28 Nov 2025 · ~1 min read
Quick answerRBI has issued comprehensive directions for Urban Co-operative Banks on issuing and managing credit and debit cards, effective immediately from November 28, 2025. These cover card conduct, co-branding, and form factors, aligning UCBs with broader card regulations.
The rule, in the simplest words
UCBs must follow the new RBI card rules that started on 28 Nov 2025, which bring all credit, debit and co‑branded card rules together in one place.
If a cardholder has already paid a bill and the bank wants to change the refund amount, the bank must first get the cardholder’s clear (explicit) okay; if the cardholder says no or does not answer, the refund must go straight back to the cardholder’s bank account.
Any partnership where a UCB puts its brand on a debit card (co‑branding) has to match the specific guidelines given in the directions.
Banks need to update their card policies, billing cycles, APR (annual percentage rate – the yearly interest cost) disclosures and loyalty‑program rules to match the new requirements.
All staff, especially those handling add‑on cards (extra cards linked to the main account), charge cards (cards you must pay in full each month) and business credit cards (cards for company spending), must be trained on the new definitions and conduct rules.
How it plays out — a real example
Riya Patel, a credit‑card officer in Mumbai, receives a request from a customer who has already cleared his credit‑card bill but is due a refund. She first asks the customer for explicit consent to adjust the refund amount; when he agrees, she processes the adjustment. If the customer had not replied, Riya would have automatically credited the refund to his linked bank account, as the RBI directions require.
What changed
RBI issued the 'Urban Co-operative Banks – Credit Cards and Debit Cards: Issuance and Conduct Directions, 2025' under Section 35A of the Banking Regulation Act, 1949. The directions consolidate and update rules for UCBs on credit, debit, and co-branded cards (excluding co-branding credit cards), effective immediately on November 28, 2025. They include definitions for terms like add-on cards, APR, and loyalty programs, and cover conduct, form factor, and co-branding arrangements.
What it means for you
UCBs must now comply with a unified framework for card issuance and conduct, replacing earlier piecemeal guidelines. This ensures consistency with prudential, payment, and cybersecurity directions. Banks need to review their card products, co-branding deals, and customer communication to align with the new definitions and requirements.
What you must do
Review and update card issuance policies to comply with the new definitions and conduct rules.
Ensure co-branding arrangements for debit cards meet the specified guidelines.
Align billing cycles, APR disclosures, and loyalty programs with the direction's requirements.
Train staff on the new definitions, including add-on cards, charge cards, and business credit cards.
Who it affects
Urban Co-operative Banks (UCBs), Card-issuing departments in UCBs, Compliance and risk management teams in UCBs, Co-branding partners of UCBs
❓ Common questions
When do these directions take effect?
The directions came into force immediately on November 28, 2025, the date of issuance.
📜 Read the original circular — full text as issued by RBI
As the cardholder has already cleared the dues, card-issuers shall seek explicit consent of the cardholder to adjust the refund amount in line with the provision stipulated at paragraph 31 of the MD.
• Case I - If the cardholder gives explicit consent, then refund amount shall be adjusted.
• Case II - If the cardholder does not provide the consent or no response is received for adjustment of the refund, then the refund amount will be credited to the bank account of the cardholder in line with paragraph 31.
Further, if the cardholder makes a request for crediting the refund (transaction for which payment has already been made), the same shall be credited back to the bank account of the cardholder irrespective of the cut off defined under paragraph 31.
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/DOR/2025-26/278 · issued 28 Nov 2025. The plain-English explanation above is BankPulse’s own independent summary.
Example: if you are a Compliance officer at a bank this circular applies to (Urban Co-operative Banks (UCBs), Card-issuing departments in UCBs, Compliance and risk management teams in UCBs, Co-branding partners of UCBs), your first concrete step on “UCB Credit & Debit Card Directions 2025” is: “Review and update card issuance policies to comply with the new definitions and conduct rules.” (RBI issued this 28 Nov 2025).
Action required: Review and update card issuance policies to comply with the new definitions and conduct rules.
Action required: Ensure co-branding arrangements for debit cards meet the specified guidelines.
Action required: Align billing cycles, APR disclosures, and loyalty programs with the direction's requirements.
Action required: Train staff on the new definitions, including add-on cards, charge cards, and business credit cards.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13027&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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