Digital payments are gaining popularity each day and many people prefer digital payments as it’s a more convenient method of making payments. With the help of digital payments, you can send money from one bank account to another quite easily. The Government is also taking necessary steps to make India a digital economy. As many people use digital payments, there are also issues like failed transactions, funds sent to the wrong address and so on. To look into issues arising out of digital transactions, the Reserve Bank of India (RBI) is planning to set up a dedicated ombudsman scheme. This scheme will look into issues relating to digital payments.
Now many people prefer making payments via debit card, credit card, mobile wallet, and UPI. As per studies, digital transactions in India have surged three-fold in the last 2 years. With an increase in digital transactions, RBI feels there should be a dedicated and cost-free grievance redressal mechanism to increase consumer confidence in digital payments. Therefore, the central bank has decided to set up an "Ombudsman Scheme for Digital Transactions". This Ombudsman will cover the services provided by the entities which come under Reserve Bank’s regulatory jurisdiction. As per the report, the scheme will be notified by the end of January 2019.
With the introduction of this scheme, people who face any issues with digital transactions can approach the Ombudsman. Currently, more than 20% of the complaints received by RBI relate to either debit or credit cards.
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To increase customer confidence in digital payments, RBI is planning to introduce the concept of limited liability for prepaid digital wallets like Mobikwik, Oxigen and Amazon Pay.
Last year, the Reserve Bank of India (RBI) had introduced the concept of ‘zero liability’ for card users, if they report frauds in time. For instance: As a cardholder, if you have lost money due to third-party breach and report it to the bank within 3 days, you will receive the entire amount and your liability would be zero.
The limited liability concept would be extended to digital wallets as well. If you lose money from your digital wallet due to a fraudulent transaction, your liability would be low. As per reports, the liability limits for digital wallets is likely to be lower, due to the smaller transaction size and lower balances.
Introduction of limited liability concept on digital wallets will add an extra layer of safety to digital payments and this promotes digital payments in India.
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