This compensation is only for the consequential loss faced by the complainant while there is no limit on the amount in a dispute that can be brought before the Ombudsman for which the Ombudsman or their deputy can facilitate a settlement or pass an award.
In addition, the RBI Ombudsman can also have the power to provide a compensation up to Rs 3 lakh for the loss of the complainant’s time, expenses incurred, harassment or mental anguish suffered. This particular limit was raised from Rs 1 lakh.
This new rule will come into force with effect from July 1, 2026.
Aggrieved customers can file a complaint to the RBI Ombudsman if they don’t get a response of their complaints in 30 days from regulated entities, or if they are not satisfied with the resolution.
RBI Ombudsman however will not accept complaints which are pending before any court, tribunal or arbitrator or any other judicial or quasi-judicial forum.
“The proposed ceilings— Rs 30 lakh (consequential loss) and Rs 3 lakh (time/expenses/harassment)—strike a prudent balance, between providing meaningful relief for consumers and deterrence on the one hand, and interest of the regulated entities on the other hand,” RBI said.Regulated entities can appeal against the compensation before the appellate authority within 30 days from the date of receipt of the complainant’s letter of acceptance of the award.
The regulator has kept the compensation amounts higher as proposed despite receiving counter feedback. It specifically received a comment against Rs 30 lakh compensation from prepaid payment instruments (PPI) issuers which typically handles low-volume transactions.
“The compensation under the scheme is principle-based and entity-neutral, and the prescribed amounts are upper ceilings, with the actual compensation to be determined by the Ombudsman based on the facts and merits of each case,” it added.
Commercial Banks, regional rural banks, state co-operative banks, central co-operative banks, Urban co-operative banks, deposit-taking non-banking financial companies (except housing finance companies) and NBFCs having customer dealings with minimum Rs 100 crore assets, PPI issuers and credit information companies will be under the scheme.