Alerts & Updates 26th Jun 2026
The RBI has carried out amendments to its directions on Customer Protection in EBT vide its circular dated June 24, 2026. These directions build upon the RBI’s earlier instructions on “Customer Protection – Limiting Liability of Customers in Unauthorized Electronic Banking Transactions” dated July 6, 2017, which were subsequently consolidated under the Reserve Bank of India (Commercial Banks – Responsible Business Conduct) Directions, 2025.
The amendments mark an important shift from a regime focused primarily on limiting customer liability in unauthorized transactions to a broader customer protection framework. The Directions introduce the concept of “fraudulent electronic banking transactions”, define bank negligence and customer negligence, place the burden of proving customer liability on banks, provide for zero liability in specified cases and establish a compensation mechanism for victims of small-value digital frauds.
This update covers important aspects of the issue and the key changes introduced by RBI and also covers recent judicial trends on Fraudulent Electronic Banking Transactions.
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