Month: January 2021

“The DPI for March 2019 and March 2020 work out to 153.47 and 207.84, respectively, indicating (an) appreciable growth,” it said in a statement.

Going forward, RBI-DPI will be published on the central bank’s website on a semi-annual basis from March 2021 onwards with a lag of four months.

The RBI-DPI comprises of five broad parameters that enable measurement of deepening and penetration of digital payments in the country over different time periods.

The parameters are payment enablers (weight 25 per cent), payment infrastructure–demand-side factors (10 per cent), payment infrastructure – supply-side factors (15 per cent), payment performance (45 per cent) and consumer centricity (5 per cent).

Each of these parameters have sub-parameters which, in turn, consist of various measurable indicators, RBI said.

The RBI-DPI has been constructed with March 2018 as the base period, meaning DPI score for March 2018 is set at 100.

Digital payments in India have been growing rapidly.

Earlier in February, RBI had announced it will construct and periodically publish a composite DPI to capture the extent of digitisation of payments effectively.

The objective of DPI is to reflect accurately the penetration and deepening of various digital payment modes.

In a letter to Reserve Bank of India (RBI) Deputy Governor M K Jain, the Central Consumer Protection Authority (CCPA) Chief Commissioner Nidhi Khare stated that 2,850 complaints pertaining to “transactions failed/cancelled but money not refunded” forming 20 per cent of grievances registered in the banking sector have been received through the government-run National Consumer Helpline (NCH).

She said although banks are crediting the amount into the consumer or beneficiary’s account, it is not being done in the prescribed timeline as directed by the RBI guidelines.

In view of this, there is a need for banks to adhere to the timelines for settlement of claims as per the guidelines issued by the RBI, she added.

In this backdrop, Khare said: “RBI, being the banking regulator, is requested to look into the matter and take up the issue with the banks urging them to adhere to the timelines stipulated in guidelines issued by RBI in this regard.”

The CCPA can extend cooperation to the RBI in ensuring speedy redressal to the consumers, she said in the letter.

Further, Khare informed that the analysis of the consumer grievances received through NCH showed that a number of grievances have been received pertaining to failed or cancelled banking transactions and money not refunded.

There were also grievances related to inter-banking services like IMPS and UPI, wherein transactions have failed but money not reversed/transferred although money deducted from the bank or wallet account of the consumers, she added.

The letter also said the CCPA was established on July 24, 2020 to regulate matters related to violation of rights of consumers, unfair trade practices, and false or misleading advertisements which are prejudicial to the interest of public and consumers and to protect, promote and enforce the rights of consumers as a class.

The CCPA is empowered to conduct investigations into violation of consumer rights, order recall of unsafe goods and services as well take sue-motto complaints where a class of consumers is impacted due to a defective product or deficient services and also impose penalties.

While conducting an investigation after preliminary inquiry, CCPA will have the same powers given under the provisions of the Code of Criminal Procedure, 1973 for carrying out search and seizure, the letter added.

The Finance Ministry has sought feedback from key stakeholders in the financial system on whether compliances under major Acts administered by the Department of Financial Services (DFS) can be rationalised.

Further, the ministry wants the stakeholders to provide inputs on each interface, where a citizen has to interact with the respective institution and whether this can be simplified.

This exercise is aimed at making the regulatory framework simple and to rationalise the compliance burden for citizens and business.

Key objective

The ministry, which sought feedback from banks, insurance companies, microfinance institutions and a couple of large non-banking finance companies, said the key objective of this exercise is to provide services in a time-bound, transparent, and predictable manner with minimum human interface.

Major Acts

The major Acts administered by the DFS that are being considered for rationalisation of compliances are: the Reserve Bank of India (RBI) Act, 1934; the Banking Regulation (BR) Act, 1949; the Insurance Regulatory and Development Authority of India (IRDAI) Act, 1999; the Insurance Act, 1938; the Credit Information Companies (Regulation) Act, 2005; and the National Housing Bank (NHB) Act, 1987. The ministry observed that although the list of some compliances under major Acts that has been prepared is not exhaustive, it requested financial sector business entities/ industry associations to examine the matter from the point of view of compliances required to be fulfilled by the industry and the public whom the industry serves.

This move by the ministry to seek industry feedback on rationalisation of compliances under various Acts, Regulations, Directions, Master Circulars/ Directions, and other subordinate legislation comes in the backdrop of India’s rank improving to 63 (among 190 countries) in October 2020 in World Bank’s ‘Doing Business Report’ from 77 in October 2019.

In a speech in September 2019, MK Jain, Deputy Governor, RBI, emphasised that it is very important for banks to demonstrate a good compliance culture to maintain their reputation and win the trust of customers, investors and regulators. Such culture is important for banks to avoid poor conduct and loss of trust.