RBI unveils new measures to protect customers from digital fraud
What's the story
The Reserve Bank of India (RBI) has announced new measures to protect customers from digital fraud. The announcement was made by RBI Governor Sanjay Malhotra after the Monetary Policy Committee meeting on February 6, 2026. The central bank will introduce a wider range of measures to strengthen customer protection and improve credit flow.
Compensation scheme
Draft guidelines on customer protection
Malhotra said the RBI will issue three draft guidelines focusing on customer protection. These include mis-selling, loan recovery and engagement of recovery agents, and limiting customer liability for unauthorized electronic banking transactions. He also proposed a framework to compensate customers up to ₹25,000 for losses incurred in small-value fraudulent transactions.
Digital payment security
Discussion paper on enhancing digital payment safety
The RBI will also publish a discussion paper on possible measures to enhance the safety of digital payments. These measures, according to Malhotra, could include lagged credits and additional authentication for certain categories of users such as senior citizens. The central bank is also looking at revising guidelines for existing schemes like the Lead Bank Scheme (LBS), Kisan Credit Card Scheme, and Business Correspondent Model.
Loan limit hike
Proposed increase in collateral-free loan limit for MSMEs
The RBI has proposed to double the limit of collateral-free loans to micro, small and medium enterprises (MSMEs) from ₹10 lakh to ₹20 lakh. To boost financing for the real estate sector, banks may be allowed to lend to the Real Estate Investment Trusts (REITs), subject to certain prudential safeguards.
UCB support
Changes to urban cooperative banks' financial limits
The RBI has proposed to increase the financial limits on unsecured loans and loans to nominal members by urban cooperative banks (UCBs). It also plans to remove tenor and moratorium-related requirements on housing loans given by Tier III and Tier IV UCBs. To enhance managerial and technical capacity of the UCBs, a new initiative called Mission-SAKSHAM (Sahakari Bank Kshamta Nirman) will be launched.
NBFC exemption
Proposed exemption for certain NBFCs
The RBI has proposed to exempt non-banking financial companies (NBFCs) with no public funds and no customer interface, and an asset size not exceeding ₹1,000 crore, from the registration requirement. It also plans to remove the requirement for certain NBFCs to take prior approval for opening more than 1,000 branches. These measures are aimed at promoting ease of doing business for NBFCs.