RBI Scam Compensation Framework for Digital Transactions

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The Reserve Bank of India (RBI) updated its guidelines regarding customer liability in digital payment fraud.
Starting January 1, 2027, a one-year pilot project will compensate victims of small online frauds and deception scams.

This framework acts as a safety system to protect bank customers from online payment scams.
It updates the older 2017 rules that protected users only against direct security hacking.
The policy introduces Fraudulent Electronic Banking Transactions (EBTs) as a legal term, so victims get money back even if fraud forced them to reveal details.
The Reserve Bank of India (RBI) controls and regulates this protection framework.

It offers monetary help to victims of digital arrests, phishing attacks, and stolen OTP frauds.
The framework shifts the legal burden onto banks, requiring them to prove customer carelessness before denying claims.

Individual victims suffering losses up to ₹50,000 can claim 85% of their lost money, capped at ₹25,000.
For stolen amounts under ₹29,412, victims receive exact 85% of the loss, while losses between ₹29,412 and ₹50,000 receive a maximum payout of ₹25,000.
The system completely excludes online scam losses that exceed ₹50,000.
A customer can use this financial remedy only once in their lifetime, and joint accounts allow only one claim.

The RBI covers nearly 75% of the total compensation payout.
The remitter bank of the customer pays half of the remaining 25% amount.
The beneficiary bank pays the other half of the remaining 25% loss, though the remitter bank covers this if money moves abroad.

Customers lose compensation eligibility if they ignore direct warning alerts or fail to update their registered contact numbers and emails with the bank.
Banks are held negligent if they fail to send transaction alerts, lack a 24x7 reporting system, or delay taking action after a customer complaint.
Users carry zero liability if leaks occur at third-party payment gateways, telecom platforms, or aggregators.

A customer must report the fraud within 5 calendar days to both their bank and the 1930 National Cyber Crime Helpline to qualify for relief.
Banks must settle domestic fraud cases within 45 calendar days and international cases within 60 calendar days while restoring lost interest.
For credit card frauds, banks must issue a temporary shadow refund within 5 calendar days to stop interest charges during the probe.
Banks must send free and instant SMS messages for all digital transactions above ₹500 to keep offline users informed.