Onus on Banks to compensate for online frauds

If a customer loses money from his/her account due to online fraud then RBI made it clear to be the bank’s onus to compensate for the loss. The Banks are liable for unauthorized electronic banking transactions, provided the customer communicates such transactions within a reasonable time period.

This is the second time since May that the central bank is taking a pro-customer approach to safeguard users against online frauds.

Notwithstanding the umbrella cover offered to customers on these transactions, if communication from the customer was delayed and made 4-7 days after the incident, the customer’s liability was a maximum of Rs. 5,000, Rs. 10,000 and Rs. 25,000 depending on the type of bank account or card.

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