Master Directions

RBI/CEPD/2025-26/385
CEPD.PRD.No.S1031/13.01.019/2025-26

January 14, 2026

Reserve Bank of India (Non-Bank Prepaid Payment Instruments Issuers - Internal Ombudsman) Directions, 2026

In exercise of the powers conferred by Section 18 of the Payment and Settlement Systems Act, 2007, the Reserve Bank of India, being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Directions hereinafter specified.

These Directions are issued with a view to strengthen the Internal Grievance Redress mechanism within a non-bank prepaid payment instruments issuer and ensure a speedy and meaningful resolution of customer complaints by enabling a review before their rejection, by an apex level authority within the non-bank prepaid payment instruments issuer.

Chapter I

Preliminary

1. Short Title and Commencement

(1) These Directions shall be called the Reserve Bank of India (Non-Bank Prepaid Payment Instruments Issuers - Internal Ombudsman) Directions, 2026.

(2) These Directions shall come into force with immediate effect except clause 7(2), 14(2) and 14(4) which shall be complied with, latest by June 30, 2026.

2. Suspension

(1) The Reserve Bank, if it is satisfied that it is expedient so to do, may, by an order, suspend for such period as may be specified in the order, the operation of any or all of the provisions of these Directions, either generally or in relation to any specified regulated entity.

(2) The Reserve Bank may by an order, extend from time to time, the period of any suspension ordered as aforesaid by such period, as it may deem fit.

3. Applicability

(1) These Directions shall be applicable to Non-Bank Prepaid Payment Instruments Issuers (hereinafter collectively referred to as 'PPI issuers' and individually as a 'PPI issuer') as defined under clause 4(1)(h) of these Directions and having more than one crore Prepaid Payment Instruments outstanding as on March 31, 2025, or thereafter.

(2) The directions shall also be applicable to the PPI issuers, which meets the above mentioned criteria after March 31, 2025, with effect from six months from meeting the eligibility criteria. The directions shall continue to remain applicable to a PPI issuer, even if the number of Prepaid Payment Instruments outstanding falls below the threshold at a later date.

4. Definitions

(1) In these Directions, unless the context states otherwise, the terms herein shall bear the meanings assigned to them as below:

(a) “Competent Authority” means Managing Director/ Chief Executive Officer of the PPI issuer;

(b) “Complaint” means a representation in writing or through other modes alleging deficiency in service on the part of the PPI issuer with or without seeking relief thereon;

(c) “Customer” means a person who uses, or is an applicant for, a service provided by the PPI issuer;

(d) “Deficiency in service” means a shortcoming or an inadequacy in any service, which the PPI issuer is required to provide statutorily or otherwise, which may or may not result in financial loss or damage to the customer;

(e) “Deputy Internal Ombudsman (Dy. IO)” means any person appointed under clause 6 of these Directions;

(f) “Financial Sector Regulatory Body” means regulatory body for financial sector entities and includes:

(i) The Reserve Bank of India established under the Reserve Bank of India Act, 1934;

(ii) The Securities and Exchange Board of India established under the Securities and Exchange Board of India Act, 1992;

(iii) The Insurance Regulatory and Development Authority of India established under the Insurance Regulatory and Development Authority of India Act, 1999;

(iv) The Pension Fund Regulatory and Development Authority established under the Pension Fund Regulatory and Development Authority Act, 2013;

(g) “Internal Ombudsman (IO)” means any person appointed under clause 5 of these Directions;

(h) “Non-Bank Prepaid Payment Instruments Issuer” means a company, as defined in the Companies Act, 2013, which has been granted a Certificate of Authorisation by the Reserve Bank of India under Section 7(1) of the Payment and Settlement Systems Act, 2007 (51 of 2007) to operate as a Prepaid Payment Instrument Issuer (PPI);

(i) “Regulated Entity (RE)” means a commercial bank or payments bank or small finance bank or a non-banking financial company or a non-bank prepaid payment instrument issuer or a credit information company which are covered under the purview of the Internal Ombudsman framework, or any other entity as may be specified by the Reserve Bank from time to time.

(2) All other expressions, unless defined herein, shall have the same meaning as assigned to them under the Banking Regulation Act, 1949, the Reserve Bank of India Act, 1934, the Payment and Settlement Systems Act, 2007, the Credit Information Companies (Regulation) Act, 2005, the Credit Information Companies Rules, 2006, the Credit Information Companies Regulations, 2006, or the Reserve Bank - Integrated Ombudsman Scheme (as amended from time to time) or regulations, directions and guidelines issued by the Reserve Bank of India.

Chapter II

Office of the Internal Ombudsman

5. Appointment of Internal Ombudsman

(1) The IO shall either be a retired or serving officer, in the rank equivalent to a General Manager in the RE under the purview of the Internal Ombudsman framework or a Financial Sector Regulatory Body, having necessary skills and experience of minimum seven years of working in areas such as banking, non-banking finance, regulation, supervision, payment and settlement systems, credit information or consumer protection.

Provided that, if the person is a serving officer, he / she is required to relinquish the same before assuming charge as IO.

(2) The IO shall previously not have been employed, nor presently be employed, by the PPI issuer or a holding, associate or subsidiary company of the PPI issuer.

(3) The IO shall not be over 70 years of age before the completion of the tenure.

(4) A person may work as the IO in more than one RE simultaneously at the discretion of the REs concerned, subject to the approval of the Board or Customer Service Committee / Consumer Protection Committee of the Board of the appointing RE.

6. Appointment of Deputy Internal Ombudsman

(1) The Dy. IO shall either be a retired or serving officer, in the rank equivalent to a Deputy General Manager in the RE under the purview of the Internal Ombudsman framework or a Financial Sector Regulatory Body, having necessary skills and experience of minimum five years of working in areas such as banking, non-banking finance, regulation, supervision, payment and settlement systems, credit information or consumer protection.

Provided that, if the person is a serving officer, he / she is required to relinquish the same before assuming charge as Dy. IO.

(2) The Dy. IO shall previously not have been employed, nor presently be employed, by the PPI issuer or a holding, associate or subsidiary company of the PPI issuer.

(3) The Dy. IO shall not be over 70 years of age before the completion of the tenure.

(4) The Dy. IO shall not be employed in more than one RE simultaneously.

7. Number of Internal Ombudsman / Deputy Internal Ombudsman

(1) Every eligible PPI issuer shall appoint at least one IO.

(2) The Board of the PPI issuer shall determine, at least once in a year, the number of IO/ Dy. IO to be appointed having due regard to volume and complexity of the complaints received, and ensuring that the IO/ Dy. IO get sufficient time to apply his/her mind on the principles of fairness, equity and natural justice while reviewing the resolution provided by the PPI issuer.

(3) While appointing additional IO / Dy. IO, the PPI issuer shall consider the need for diversity of experience of the incumbents to deal with different types of cases. In such cases, the PPI issuer may clearly define the jurisdiction of each IO / Dy. IO.

8. Tenure of Internal Ombudsman / Deputy Internal Ombudsman

(1) The appointment of the IO / Dy. IO in the PPI issuer shall be contractual.

(2) The PPI issuer shall ensure that the post of the IO does not remain vacant at any point of time. During the temporary absence of the IO, the Dy. IO may function as the IO.

(3) In a rare case where both IO/s and Dy IO/s are on leave / absent, the PPI issuer may designate its serving official equivalent to the General Manager rank as the IO for a period not exceeding one month, with the approval of the Board. Such official shall not have any reporting relationship with the business verticals of the PPI issuer during the period in which he/she is designated as the IO.

(4) The tenure of the IO / Dy. IO in the PPI issuer shall be a fixed term of not less than three years. However, the total tenure (including extension/reappointment, if any) of the IO / Dy. IO in the PPI issuer shall not exceed five years.

(5) To fill a vacancy, the PPI issuer shall undertake the process of fresh appointment at least three months in advance of the expiry of the tenure of the incumbent IO and ensure that there is a reasonable overlap between the time of demitting of office of the outgoing IO and the incoming IO.

(6) The IO / Dy. IO shall not be removed before the completion of his/her contracted term without the approval of the Board. In case a vacancy arises on account of reasons beyond the control of the PPI issuer (such as resignation, incapacitation, illness, death, etc.), the PPI issuer shall inform Reserve Bank of India within 10 working days from the date of such vacancy and shall appoint a new IO / Dy. IO as per eligibility criteria specified under clause 5 and clause 6 of these Directions within three months from the date of vacancy.

(7) The Board of the PPI issuer shall determine the structure of emoluments, facilities and benefits accorded to the IO / Dy. IO, which should be appropriate keeping in view the stature and position of the IO / Dy. IO being at the apex of the grievance redress mechanism of the PPI issuer as also the need to attract experienced persons with requisite expertise. These emoluments, facilities and benefits accorded to the IO / Dy. IO, once determined, shall not be changed adversely during the tenure of the IO / Dy. IO.

9. Administrative Oversight

(1) The IO shall report to the Competent Authority, as defined under clause 4(1)(a) of the Directions, of the PPI issuer administratively, and to the Board of the PPI issuer functionally.

10. Secretariat of the office of Internal Ombudsman

(1) The PPI issuer shall provide such number of its officers and staff to the office of the IO as is considered necessary for the smooth functioning of the office of the IO.

(2) All other requisite office infrastructure, including information technology support shall be made available to the office of the IO to enable the IO/ Dy. IO to discharge the responsibilities effectively and efficiently.

(3) The office of the IO may preferably be placed in the Head Office or Corporate Office of the PPI issuer.

11. Internal Audit

(1) The Internal Audit Department of the PPI issuer shall conduct an audit of the implementation of these Directions on an annual basis, covering, inter-alia:

(a) The process of appointment / reappointment of the IO/Dy. IO, adequacy of the human resources and infrastructure provided to the office of the IO in relation to the volume of complaints;

(b) Implementation of auto-escalation of the partially resolved or wholly rejected complaints to the office of the IO within the timelines;

(c) Action taken by the office of the IO with regard to analysis of complaints, reports submitted to the Reserve Bank of India and the PPI issuer, raising awareness of the staff of the PPI issuer about the grievance redressal processes, and such other processes;

(d) Submission of the information related to appointment of the IO / Dy. IO and submission of periodic report on the functioning of the IO by the PPI issuer to the Reserve Bank.

(2) The scope of the internal audit shall exclude any assessment of the correctness of decisions taken by the IO / Dy. IO.

Chapter – III

Role and Responsibilities

12. Role and Responsibilities of Internal Ombudsman / Deputy Internal Ombudsman

(1) The office of the IO shall not handle complaints received directly from the complainants or members of the public. It shall deal with the complaints that have already been examined by the PPI issuer but have been partially resolved or being wholly rejected by the PPI issuer.

(2) The IO / Dy. IO shall not represent the PPI issuer in legal cases before any court or fora or authority.

(3) While the IO may decide any or all complaints, the power for the Dy. IO to decide the complaints may be defined under a policy approved by the Board.

(4) The IO / Dy. IO shall recommend suitable compensation to the complainant, as per the compensation prescribed by the Reserve Bank of India in its extant guidelines, if any, and as per the compensation policy of the PPI issuer, if any, in case there is no prescription from the Reserve Bank of India.

(5) The IO may recommend compensation in accordance with the Reserve Bank - Integrated Ombudsman Scheme, as amended from time to time, for any consequential loss and the loss of time, expenses incurred and harassment / mental agony suffered by the complainant, over and above the compensation recommended in clause 12(4).

(6) The office of IO shall, on a quarterly basis, analyse the pattern of all complaints received against the PPI issuer, such as product-wise, category-wise, consumer group-wise, geographical location-wise, etc., and provide inputs to the PPI issuer for policy intervention, if so warranted.

(7) The IO shall suggest means for taking actions to address the root cause of complaints of similar / repeat nature and those that require policy level changes in the PPI issuer.

(8) The IO/ Dy. IO shall have ‘read-only’ access to the Reserve Bank’s Complaint Management System to enable them to keep abreast of decisions of the RBI Ombudsman/ Appellate Authority. The PPI issuer shall seek such access for the IO / Dy. IO from the Consumer Education and Protection Department of the Reserve Bank.

(9) The Dy. IO shall functionally report to the IO.

13. Board Oversight

(1) The IO shall be designated as a permanent invitee to the meetings of the Board. In PPI issuers having multiple IOs, a view shall be taken by the Board to have representation of more than one IO or having a system of rotation.

(2) The IO shall furnish periodic reports (including the analysis of complaints) on his / her activities to the Board, preferably at quarterly, but not less than half yearly, intervals.

(3) The decision of the IO / Dy. IO can be overruled only with the approval of the Competent Authority as defined under clause 4(1)(a) of these Directions.

(4) All such cases where the decision of the IO / Dy. IO has been overruled by the Competent Authority shall be placed before the Board of the PPI issuer for review.

(5) Information on the complaints resolved by the RBI Ombudsman in favour of complainant, either partially or fully, shall also be placed before the Board, on quarterly basis. The information shall be accompanied with an analysis of minimum top five categories of complaints along with remedial measures so as to avoid complaints of a similar nature in future.

Chapter - IV

Procedural Guidelines for PPI issuers

14. Procedure for Complaint Redress by Internal Ombudsman / Deputy Internal Ombudsman

(1) A fully automated Complaints Management System shall be put in place by the PPI issuer and access to the System shall be provided to the IO / Dy. IO. All complaints that are partially resolved or wholly rejected by the PPI issuer’s internal grievance redress mechanism shall be auto escalated to the office of the IO for review;

1. in case of complaints, for which Reserve Bank of India, National Payments Corporation of India, or card network guidelines prescribe a timeline for resolution, sufficiently in advance such that IO / Dy. IO gets at least 10 days for review of such complaints to enable final decision to be communicated to the complainants within the timelines prescribed by Reserve Bank of India, National Payments Corporation of India, or card network, as applicable;

2. in all other cases, within 20 days of receipt.

(2) The PPI issuer shall provide only three categories i.e. ‘Fully Resolved’, ‘Partially Resolved’ and ‘Wholly Rejected’ in its Complaint Management System for recording the decision on the complaints before escalation to the office of IO. The complaints outside the purview of the IO / Dy. IO under the clauses 14(5)(c) to 14(5)(e) are exempted from such classification.

(3) The PPI issuer shall formulate a Standard Operating Procedure (SOP) for flow of complaints and information in a time bound manner.

(4) The PPI issuer shall ensure that a complaint is not closed by the same branch / unit / other touch points, whether it has been resolved (fully or partially) or rejected. A complaint which is being wholly rejected or partially resolved shall be reviewed at a fairly senior level, which the PPI issuer may decide as deemed fit, before sending it to the office of IO.

(5) The following types of complaints shall be outside the purview of these Directions and shall not be handled by the IO/ Dy. IO:

1. Complaints related to corporate frauds, misappropriation etc., on the part of the PPI issuer that do not impact the customer in any manner;

2. References in the nature of suggestions and commercial decisions of PPI issuer. However, service deficiencies in cases falling under ‘commercial decisions’ will be valid complaints for the office of the IO;

3. Complaints / references relating to (i) internal administration, (ii) human resources, or (iii) pay and emoluments of staff in the PPI issuer;

4. Complaints which have been decided by or are already pending in judicial / quasi-judicial fora such as Courts, Consumer Disputes Redressal Commission, Arbitration, etc.;

5. Disputes for which remedy has been provided under Section 18 of the Credit Information Companies (Regulation) Act, 2005.

The PPI issuer shall forward all rejected / partially resolved complaints under the categories (a) and (b) above to the IO / Dy. IO, who shall look for inherent deficiency in service in such cases and take a view whether any of these complaints can be exempted under (a) and / or (b) above as decided by the PPI issuer. Complaints that are outside the purview of these Directions shall be immediately returned back to the PPI issuer by the IO / Dy. IO.

(6) The IO / Dy. IO shall examine the complaints based on records available with the PPI issuer, including any documents submitted by the complainant and comments/ clarifications furnished by the PPI issuer to the specific queries of the IO.

(7) The IO/ Dy. IO may hold meetings with the concerned functionaries of the PPI issuer and seek any additional record / document available with the PPI issuer that are necessary for examining the complaint and reviewing the decision.

(8) The IO / Dy. IO may, if they find it necessary, seek written or oral submission (including additional information and documents) from the complainant, through the secretariat.

(9) The PPI issuer shall ensure that the final decision is communicated to the complainant within a period of 30 days from the date of receipt of complaint by the PPI issuer.

(10) The IO / Dy. IO shall record a “reasoned decision” in each case.

(11) Where the IO / Dy. IO upholds the decision of the PPI issuer to reject or partially resolve the complaint, the reply to the complainant should explicitly state that the said complaint has been reviewed by the IO / Dy. IO.

(12) For complaints that are partially resolved or wholly rejected after examination by the IO / Dy. IO, the PPI issuer shall advise the complainant about the option of approaching the RBI Ombudsman for redress (excluding complaints not covered under the Reserve Bank - Integrated Ombudsman Scheme, as amended from time to time) along with complete details of the complaint. The PPI issuer in its reply shall also mention the URL of Reserve Bank’s Complaint Management System portal for online filing of customer complaints (https://cms.rbi.org.in) and the physical / email address of the Centralised Receipt and Processing Centre¹.

(13) When a complaint is escalated to the RBI Ombudsman, the decision of the IO / Dy. IO shall be mandatorily included in the information to be submitted by the PPI issuer to the RBI Ombudsman if the complaint was already reviewed by the IO / Dy. IO. In case, the complaint was not earlier reviewed by the IO / Dy. IO, the PPI issuer shall necessarily seek his/ her comments and submit the same to the RBI Ombudsman.

(14) The PPI issuer shall use the analysis of complaints handled by IO / Dy. IO in the training programmes / conferences to raise awareness about the pattern of complaints including the root causes, remedial measures, etc., among the frontline staff, in order to evolve consistency in handling of complaints. The IO / Dy. IO may also be involved in such trainings, where necessary.

(15) While assessing the performance of the IO / Dy. IO, in addition to the level of pendency and work done by the IO / Dy. IO towards developing uniformity across the PPI issuer in the redress of complaints, the Board shall also analyse the number of cases where there is substantive difference between the decisions of the IO / Dy. IO vis-à-vis those given by the RBI Ombudsman subsequently.

(16) The PPI issuer shall widely disseminate the guidelines / instructions regarding these Directions among the staff while communicating the appointment of IO/ Dy. IO within the organization (all branches and administrative offices).

(17) The PPI issuer shall not provide the contact details of the IO / Dy. IO in the public domain as the IO / Dy. IO shall not handle complaints received directly from the customers.

Chapter - V

Regulatory and Supervisory Oversight by the Reserve Bank

15. Supervisory Oversight

(1) The areas relating to customer service and customer grievance redress, as well as the implementation of these Directions, shall be a part of the supervisory review by the Department of Payment and Settlement Systems of the Reserve Bank.

(2) Consumer Education and Protection Department of the Reserve Bank may review the cases where the decision of the IO / Dy. IO has not been accepted by the PPI issuer and the aggrieved complainant approaches the RBI Ombudsman, for assessing the effectiveness of the internal grievance redress mechanism of the PPI issuer and initiating corrective actions as it may deem fit.

16. Reporting to Reserve Bank

(1) The PPI issuer shall, within five working days of appointment of the IO or Dy. IO, furnish the details of the official so appointed to the Consumer Education and Protection Department, Central Office, Reserve Bank of India (email: iocepd@rbi.org.in) in the following format:

(2) The PPI issuer shall put in place a system of periodic reporting of information to the Consumer Education and Protection Department, Central Office, Reserve Bank of India, on a quarterly basis as per format provided in the Annexure. The report shall be submitted on or before the 15th day of the month following the quarter to which it relates to.

Chapter - VI

Repeal Provisions

17. Repeal of the existing Schemes

(1) With the issue of these Directions, the Master Direction - Reserve Bank of India (Internal Ombudsman for Regulated Entities) Directions, 2023 dated December 29, 2023 issued by the Reserve Bank stands repealed.

(2) All appointments / actions under the aforesaid Master Direction, prior to the coming into effect of these Directions, shall be deemed to have been made under these Directions.

(Dr. Neena Rohit Jain)
Chief General Manager

¹ Centralized Receipt and Processing Centre (CRPC) Reserve Bank of India, Central Vista, Sector 17, Chandigarh - 160 017 (email: crpc@rbi.org.in)