Banking

The Reserve Bank – Integrated Ombudsman Scheme, 2026 (RB-IOS 2026) came into force on 1 July 2026, replacing the Integrated Ombudsman Scheme, 2021. It is designed to provide a single, cost-free, quick and non-adversarial grievance redress mechanism for customers of banks and other covered regulated entities. Reserve Bank of India For a banking lawyer, the following are the most important features: 1. Wider coverage The Scheme covers complaints against a broad range of RBI-regulated entities, including: Commercial Banks Regional Rural Banks (RRBs) Scheduled Primary Co-operative Banks Eligible NBFCs Credit Information Companies Non-bank Prepaid Payment Instrument (PPI) issuers This is particularly relevant for Punjab Gramin Bank and Sarva Haryana Gramin Bank, as they are covered entities. Reserve Bank of India 2. One Nation – One Ombudsman Customers are not required to identify a territorial Ombudsman office. Complaints are allocated centrally through RBI, making the process location-independent and more streamlined. SC Bank 3. Cost-free mechanism No court fee. No filing charges. The process is intended to be informal and summary in nature. The Ombudsman is expected to resolve disputes through settlement where possible before issuing an Award. SC Bank 4. Expanded grounds of complaint Complaints can include: deficiency in banking services; unauthorised electronic transactions; ATM/debit/credit card disputes; internet and mobile banking issues; delay in remittances; wrongful charges; account closure issues; loan servicing deficiencies; digital-payment disputes; failure to follow RBI directions. The Scheme broadly covers deficiency in service by the regulated entity. SC Bank 5. No monetary limit on the amount involved in the complaint A complaint is not rejected merely because the underlying transaction amount is high. However, the compensation that may be awarded is capped under the Scheme. Current reporting indicates compensation can extend up to ₹30 lakh for actual loss in appropriate cases, with an additional amount for compensation for mental agony and harassment, subject to the Scheme's limits. The Economic Times 6. Strengthened Internal Ombudsman mechanism The 2026 Scheme places greater emphasis on the role of the Internal Ombudsman (IO) within major regulated entities so that customer grievances are reviewed internally before escalation to RBI. This is intended to improve accountability and reduce avoidable external complaints. Vinod Kothari Consultants 7. Maintainability provisions One of the most significant changes from a litigation perspective is the clearer framework on when complaints are not maintainable. Examples include situations where: the complaint has not first been taken up with the regulated entity as required; the same cause of action is pending before, or has been decided by, a court, tribunal or arbitrator; the complaint falls outside the Scheme's scope; the complaint requires elaborate oral or documentary evidence that is unsuitable for summary proceedings. Reserve Bank of India This gives banks stronger preliminary objections in appropriate cases. 8. Time-bound grievance process The Scheme prescribes timelines for: filing complaints, responses by regulated entities, Ombudsman proceedings, appeals. Banks should maintain proper complaint logs because delays can adversely affect their defence. Vinod Kothari Consultants 9. Appeals An appeal lies to the designated Appellate Authority under the Scheme against eligible Ombudsman decisions, subject to the Scheme's conditions. However, the Scheme also specifies circumstances in which a regulated entity may not have an appeal—for example, where an Award resulted from its own failure to provide the required information or documents. Reserve Bank of India 10. Summary proceedings Proceedings are intended to be: summary, informal, document-based, non-adversarial. The Ombudsman is not bound by the strict rules of evidence that apply in civil courts.