MUMBAI: The Reserve Bank of India (RBI) on Monday issued guidelines on credit card operations of banks, asking card issuers to ensure that there is no delay in despatching bills.

The guidelines, which will come into effect immediately, said the customer should be given at least a fortnight for making payment before the interest rates starts getting charged.

The guidelines, based on the recommendations of the RBI-constituted working group on Regulatory Mechanism for Cards, asked the issuing bank or non-banking financial company to pay penalty to the recipient for unsolicited cards, amounting to twice the value of the charges.

``In case, an unsolicited card is issued and activated without the consent of the recipient and the latter is billed for the same, the card issuing bank/NBFC shall not only reverse the charges forthwith, but also pay a penalty without demur to the recipient amounting to twice the value of the charges reversed,'' it said.

Unsolicited loans or other credit facilities should not be offered to customers. ``In case, unsolicited credit facility is extended without the consent of the recipient and the latter objects to the same, the credit sanctioning bank/NBFC shall not only withdraw the credit limit but also be liable to pay such penalty as may be considered appropriate,'' the RBI said.

The guidelines also asked banks or NBFCs to allow a credit card holder to surrender his card on account of any change in credit card charges to his disadvantage.

Wrong bills

The RBI asked the credit card issuers not to issue wrong bills to customers.

``In case, a customer protests any bill, the bank/NBFC should provide explanation and, if necessary, documentary evidence to customer within a maximum period of 60 days with a spirit to amicably redress the grievances,'' the guidelines said.

The central bank said that the bank/NBFC should not levy any charge that was not explicitly indicated to the credit card holder at the time of issue of the card and getting his consent.

Card issuers should quote annualised percentage rates (APR) on card products separately for retail purchase and for card advance in case of any difference between the two, the new norms said.

The method of calculation of APR should be given with a couple of examples for better comprehension, the Reserve Bank of India said.

``The late payment charges, including the method of calculation of such charges and the number of days, should be prominently indicated,'' the guidelines said.

The card issuing bank/NBFC should maintain a Do Not Call Registry (DNCR) containing both cell phone and landline phone numbers of the customer as well as unwilling non-customers, who have informed the card issuing authorities that they do not wish to receive the unsolicitated calls/SMS in this regard.

The central bank has given two months time to the card issuers to set up the DNCRs and added that wide publicity should be given to the arrangement.

It added that the bank or the NBFCs would be held responsible if any unwilling person receives calls from its Direct Selling Agents (DSAs) and Direct Marketing Agents (DMAs) or call centres.

``The card issuing bank or the NBFC should ensure that DNCR numbers are not passed on to any unauthorised person or misused in any manner,'' the guidelines said. — PTI

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