RBI Guidelines for Credit Card Issuers 2025: Key Changes You Must Know

 

CA Study Usher

The Reserve Bank of India has rolled out updated regulations to improve transparency, consumer safety, and responsible lending in the credit card segment. The RBI Guidelines for Credit Card Issuers 2025 introduce strict measures affecting banks, NBFCs, and fintech-based issuers. Here are the key highlights you need to know:

1. OTP-Based Consent for Card Issuance

What’s Changed:
Credit cards must only be issued after OTP-based consent from the applicant.
Impact:
Eliminates unsolicited card issuance and reduces identity theft.

2. Card Activation Deadline

What’s Changed:
If a card remains inactive for 30 days, the issuer must seek consumer acknowledgment. If still inactive, the card must be cancelled without charges.
Impact:
Prevents passive liabilities and hidden fees on unused cards.

3. Mandatory Fee Disclosure

What’s Changed:
Issuers must disclose all fees—including joining, annual, and interest rates—at the time of onboarding. Any changes to charges require 30 days’ advance notice.
Impact:
Greater fee transparency and more informed decision-making for consumers.

4. Improved Billing and Grace Periods

What’s Changed:
A minimum 14-day grace period is mandatory for all billing cycles. Interest cannot be charged if full payment is made within this period.
Impact:
Prevents interest-related surprises and eases repayment timelines.

5. Consent-Based EMI Conversions

What’s Changed:
All EMI conversions now require explicit consent—via OTP or written/email confirmation.
Impact:
No more auto-conversions or hidden EMI traps.

6. Streamlined Card Closure Process

What’s Changed:
Cards must be closed within 7 working days upon request. Delay attracts a ?500 per day penalty.
Impact:
Faster exit for dissatisfied customers and strict accountability for issuers.

7. Controlled Credit Limit Enhancements

What’s Changed:
Issuers cannot raise limits without consumer’s signed or digital approval. Notification of change is mandatory.
Impact:
Protects users from over-borrowing and promotes financial discipline.

8. Mandatory Credit Reporting and Error Resolution

What’s Changed:
All card activities must be reported to credit bureaus. Any errors must be resolved within 30 days of the complaint.
Impact:
Improves credit score management and enables quick dispute resolution.

9. Transparent Rewards & Expiry Rules

What’s Changed:
Issuers must declare reward point expiry rules and give a 30-day notice before any changes.
Impact:
Ensures fair redemption and clarity in loyalty programs.


Special Guidelines for Fintech and Co-Branded Credit Cards

10. Legal Responsibility in Co-Branded Cards

What’s Changed:
Banks/NBFCs issuing co-branded cards (like Flipkart Axis or Amazon ICICI) must handle all consumer grievances and compliance obligations.
Impact:
Direct accountability regardless of partner branding.

11. Digital-First Credit Cards Oversight

What’s Changed:
Fintech-issued digital-first cards must follow full KYC, data protection, and RBI-mandated marketing rules.
Impact:
Aligns digital offerings with traditional banking safeguards.


Consumer Rights Under RBI Guidelines for Credit Card Issuers 2025

AreaOld Practice2025 Guidelines
Card ClosureOpaque and delayed7-day timeline with penalty for delay
EMI ConversionsOften automaticExplicit consent mandatory
Billing PeriodsVariable grace periodsMinimum 14-day post-bill period required
Credit Limit ChangesFrequently unsolicitedConsent-based only
Card ActivationCards left idle without actionDeactivation after 30 days of inactivity

Advice for Consumers in 2025

  • Always read the welcome kit and fee schedule thoroughly.
  • Use credit cards responsibly—avoid falling for pre-approved traps.
  • Review your credit report regularly for accuracy.
  • Track changes in reward programs and use loyalty benefits before expiry.
  • Use the cooling-off period wisely before committing to new cards.

The RBI Guidelines for Credit Card Issuers 2025 aim to bring more transparency, control, and fairness to India’s credit card ecosystem. Stay informed and proactive to protect your financial well-being.


CA Study Shop provides classes & books for CA CS CMA Students. We have partnered with more than 100 top faculties of country and provide excellent customer support which is evident from our 4.9/5 star rating on Google. Student can connect with us via any mode here.

Best of luck!

ca study

Stay Connected for more authentic updates.

Jai Hind,Vande Mataram
Team CA Study

Share This Article :
Don't miss out!
Subscribe To Newsletter
Receive top education news, lesson ideas, teaching tips and more!
Invalid email address
Give it a try. You can unsubscribe at any time.
Scroll to Top