RBI Revises Customer Liability Framework for Digital Transactions

Press Release 2026-2027/533, Dated 24-06-2026

The Reserve Bank of India (RBI) has issued amendment directions revising the framework for limiting customer liability in digital transactions. The amendments expand the scope of the existing customer protection framework, reduce complaint processing timelines and introduce a compensation mechanism for small-value fraudulent electronic banking transactions.

The revised framework aims to strengthen customer protection and improve the grievance redressal process in cases of fraud involving electronic banking transactions.

1. Expansion of Customer Liability Framework

Earlier, the framework primarily covered unauthorised electronic banking transactions.

The amended directions expand the scope to include other categories of fraudulent electronic banking transactions. This ensures that customers receive protection not only against unauthorised access but also against broader fraud-related digital banking scenarios.

2. Coverage of Fraudulent Electronic Banking Transactions

The revised framework will apply to specified fraudulent electronic transactions carried out through banking channels.

This may include cases where customers suffer losses due to digital fraud, subject to the conditions and timelines prescribed under the RBI framework.

3. Faster Processing of Customer Complaints

RBI has also amended the framework to reduce the time banks take to process complaints regarding fraudulent electronic banking transactions.

Banks will be required to act more promptly in handling customer complaints, verifying claims and determining customer liability.

4. Compensation Mechanism for Small-Value Frauds

A key change introduced by the amendments is the creation of a compensation mechanism for small-value fraudulent electronic banking transactions.

This mechanism is intended to provide quicker relief to affected customers in cases involving smaller transaction amounts, reducing hardship and improving trust in digital banking channels.

5. Strengthening Customer Protection

The amendments seek to enhance customer confidence in digital banking by ensuring that banks respond efficiently to fraud complaints and provide appropriate relief where customers are eligible under the framework.

The revised approach places greater responsibility on banks to maintain robust fraud-response and grievance-redressal systems.

6. Objective of the Amendment

The amendment directions aim to:

• Expand protection beyond unauthorised transactions;
• Cover additional fraudulent electronic banking transactions;
• Reduce complaint processing timelines;
• Provide compensation for small-value digital fraud cases;
• Improve customer grievance redressal; and
• Strengthen trust in digital banking.

7. Expected Impact

The revised framework is expected to benefit bank customers by ensuring faster complaint handling and better protection against digital fraud losses. It will also require banks to strengthen internal systems for fraud detection, complaint resolution and compensation processing.

8. Key Takeaway

RBI has amended the framework for limiting customer liability in digital transactions by expanding its scope to cover additional fraudulent electronic banking transactions, reducing the time banks take to process complaints, and introducing a compensation mechanism for small-value digital fraud cases. The amendments are aimed at improving customer protection and strengthening confidence in electronic banking channels.

Click Here To Read The Full Press Release