What changed
RBI released the 'Reserve Bank of India (Rural Co-operative Banks – Debit Cards: Issuance and Conduct) Directions, 2025', applicable to all State and Central Co-operative Banks. The directions mandate board-approved policies for debit card issuance, co-branding, and grievance handling, and define key terms like debit cards, co-branded cards, and loyalty programs. They come into force immediately.
What it means for you
RCBs must now formalize their debit card operations with board-approved policies, ensuring consistency and compliance. The directions clarify rules for co-branded cards and loyalty programs, reducing ambiguity. Banks need to update their standard operating procedures for card blocking and customer compensation to align with RBI's expectations.
What you must do
- Formulate or update a board-approved policy covering debit card issuance, co-branding, and grievance redressal as per the new directions.
- Review and standardize procedures for discretionary blocking, deactivation, or suspension of debit cards, including timelines for lost card formalities.
- Ensure compliance with the definitions and conduct regulations for debit cards, including co-branded cards and loyalty programs.
- Align with existing RBI prudential, payment, and cyber security directions applicable to debit cards.
Who it affects
Rural Co-operative Banks (State Co-operative Banks and Central Co-operative Banks), Card-issuing departments of RCBs, Compliance and risk management teams at RCBs, Co-branding partners of RCBs
What is the effective date of these directions?
The directions come into force with immediate effect from the date of issuance, November 28, 2025.