6 key steps RBI has taken to ensure safe banking practices. Details here
Digital banking has brought a paradigm shift to the way we carry out financial transactions. The collateral damage, however, is the spate of frauds that accompany it. To minimise these frauds, the banking regulator has taken a number of steps so that banking remains safe and secure.
Deputy governor of Reserve Bank of India (RBI) Swaminathan J. highlighted some of these steps in a speech delivered recently in Paris.
Here, we summarise some of the points he underscored that stand to benefit depositors and investors alike.
These are the six steps that are meant to benefit investors:
1. Multi factor authentication: All banks are supposed to implement multi-factor authentication for all payments through electronic modes and fund transfers barring some explicitly small value transactions.
Out of these authentication methods, at least one of them should be generally dynamic or non-replicable such as one time password, mobile device binding or biometric etc.
ALSO READ: Different ways to protect yourself from succumbing to UPI frauds
2 Risk assessment: Banks are also meant to conduct risk assessment of the safety of digital payment products as well as suitability and appropriateness of the same. They are also meant to identify suspicious transaction behaviour and mechanisms in place to alert customers.
3. Zero liability for customers: To protect customers, regulations provide for zero liability for customers for losses due to negligence by the bank or a third-party breach.
And where it is due to customer negligence, the liability is limited to the point of reporting.
4. Digital lending guidelines: Additionally, RBI has issued guidelines on digital lending which require regulated entities to provide a key fact statement to
Read more on livemint.com
