Reserve Bank of India (Non-Banking Financial Companies - Internal Ombudsman) Directions, 2026

1. Why it exists

A complaint must be looked at again by a senior person before it is finally refused.

2. What this book does

This book creates an internal ombudsman to review complaints that were refused.

1. Start date

These rules took effect at once.

2. Three clauses have a deadline

Three of the clauses had to be met by 30 June 2026.

3. Who is covered

These rules bind a finance company that meets the size test set out here.

4. Which companies are left out

Housing finance, core investment, infrastructure and mortgage guarantee companies are outside these rules.

5. Words from the Acts

Any other word takes its meaning from the Banking Regulation Act or the RBI Act.

1. Seven years of experience

The ombudsman needs at least seven years in banking, regulation, payments or consumer protection.

2. Never worked here

The ombudsman must never have worked for this entity, its holding company or its subsidiary.

3. Age limit

The ombudsman must not pass 70 years of age before the term ends.

4. Five years for a deputy

A deputy needs at least five years of relevant working experience.

5. Never leave the seat empty

The post must never fall vacant. The deputy stands in when the ombudsman is away.

6. A stand-in for one month

If both are away, a serving officer of general manager rank may stand in for one month.

7. The stand-in reports nowhere

That stand-in must not report to any business line while acting as ombudsman.

8. Three years at least

A term must be fixed and must not be shorter than three years.

9. Five years at most

Counting every extension, one person may not serve beyond five years.

10. No removal without the committee

The ombudsman may not be removed mid-term without the committee's approval.

11. Tell RBI within ten days

If the post falls vacant for any other reason, tell RBI within 10 working days.

12. Fill it within three months

A new ombudsman must be appointed within three months of the vacancy.

13. Pay may not be cut

Once the pay and benefits are set, they may not be worsened during the term.

14. Audit may not judge decisions

That audit must not judge whether the ombudsman decided a case rightly.

15. Report every quarter

Reports go to the committee every quarter, and never less often than every six months.

16. Leave the old post first

A serving officer must give up that post before taking charge as ombudsman.

17. Rank of the deputy

A deputy ombudsman must rank with a deputy general manager.

18. At least one ombudsman

Every covered entity must appoint at least one ombudsman.

19. Count them once a year

The committee must decide once a year how many ombudsmen are needed.

20. Spread the experience

Where more are appointed, their experience should differ and their work should be split.

21. Overlap the two

The outgoing and incoming ombudsman should overlap for a reasonable time.

22. Give the office staff

The entity must give the ombudsman's office as many officers and staff as it needs.

23. Give it the systems

Office space and information technology support must be provided as well.

24. Place it at the top

The office should sit at the head office or the corporate office.

25. An audit every year

Internal audit must check every year that these rules are being followed.

26. Study the pattern each quarter

Every quarter the office must study the pattern of all complaints received.

27. Fix the root cause

The ombudsman must suggest how to stop complaints of the same kind recurring.

28. Every overrule is reviewed

Every case that was overruled must be placed before the committee for review.

29. The post is contractual

The ombudsman is appointed on contract, not as an employee.

30. Two reporting lines

The ombudsman reports to the competent authority for administration and to the committee for work.

31. No direct complaints

The ombudsman does not take complaints from customers or from the public.

32. Only refused complaints

The office sees only complaints already examined and then refused or part settled.

33. Extra for time and trouble

More may be recommended for lost time, expenses, harassment and mental agony.

34. A seat at the committee

The ombudsman is a permanent invitee to the committee's meetings.

35. Only one person may overrule

A decision of the ombudsman may be overruled only by the competent authority.

36. Show what RBI decided

Cases the RBI ombudsman decided for the customer go to the committee each quarter.

1. Twenty days otherwise

In every other case the complaint must reach the office within 20 days.

2. Thirty days to answer

The final decision must reach the customer within 30 days of the complaint.

BankPulse example. A complaint reaches the credit information company on 1 September. The final decision must reach the customer within 30 days, which is by 1 October.

3. Keep the name private

The ombudsman's contact details must not be published, because customers may not write directly.

4. An automatic system

A fully automatic complaint system must send every refused complaint to the office.

5. Write the procedure down

A standard operating procedure must set out how complaints and information move.

6. Write down the reason

The ombudsman must record a reasoned decision in every case.

7. Say it was reviewed

Where the refusal stands, the reply must say the ombudsman reviewed it.

8. Point to RBI's ombudsman

A customer still refused must be told he may go to the RBI ombudsman.

9. Send the decision upward

When a case goes to the RBI ombudsman, the internal decision must go with it.

10. Teach the staff

The pattern of complaints must be used in staff training to make handling consistent.

11. Compare with RBI's rulings

The committee must count the cases where RBI's ombudsman decided differently.

12. Tell the whole staff

The appointment and these rules must be told to every branch and office.

13. Only three labels

A complaint may be marked only fully resolved, partly resolved or wholly rejected.

14. A senior look first

A refused or part settled complaint is reviewed at a fairly senior level first.

15. What is left out

Fraud without customer harm, staff matters and court cases are outside these rules.

16. Send the doubtful ones anyway

Refused complaints under the first two headings still go to the ombudsman for a view.

17. Decide on the records

The ombudsman decides from the entity's records and the customer's own papers.

18. May ask for more

The ombudsman may meet staff and call for any further record that is needed.

19. May ask the customer

The ombudsman may seek written or spoken submissions from the customer.

1. A quarterly return

A report on the ombudsman's work goes to RBI every quarter, in RBI's own format.

2. Supervision covers this

RBI's supervision department reviews how these rules are being followed.

3. RBI may study refusals

RBI may review cases where the entity did not accept the ombudsman's decision.

4. Due by the fifteenth

That report is due on or before the 15th day of the month after the quarter.

1. Old scheme repealed

The Internal Ombudsman Directions of 2023 stand repealed by this book.

2. Earlier appointments stand

Appointments and actions taken under the old rules continue to hold good.