RBI's new credit card regulations: What changes for you?
What's the story
The Reserve Bank of India (RBI) has introduced a major amendment in credit card regulations. The change, under the "Reserve Bank of India (Commercial Banks - Credit Cards and Debit Cards: Issuance and Conduct) - Amendment Directions, 2026" seeks to standardize reporting and charges across different card issuers. The new rule states that a credit card account can only be classified as "past due" if payment is not made within three days of the due date.
Rule implications
Reporting and penal actions linked to 3-day delay
The new RBI guideline links both reporting and penal action to a three-day delay. This means that card issuers can only report an account as "past due" or impose late payment charges after this period. However, the RBI has clarified that the number of days past due will still be calculated from the original payment due date mentioned in the statement, even if penalties are triggered after three days.
Charge application
Late payment charges to be levied on outstanding amount
The RBI's amendment also specifies that late payment charges should only be levied on the outstanding amount after the due date, not on the total amount due. This is a major shift in how penalties are calculated and imposed by card issuers. The change is aimed at making penal charges more proportionate and fair for cardholders.
Regulatory alignment
New rules to come into effect from April 2027
The RBI's amendment to credit card norms is in line with broader regulatory directions on asset classification, provisioning, and income recognition. The change also aims to standardize practices across issuers and ensure that penal charges are applied more proportionately. The new rules will come into effect from April 1, 2027.