Banking laws will change from 2026, with 100-fold compensation for locker theft

Banking Laws Will Change From 2026: The Reserve Bank of India (RBI) has begun preparations for major reforms in the country's banking system. The RBI has released a draft of 238 new banking rules to the public and is seeking suggestions until November 10. These rules could be implemented beginning in 2026 after receiving public opinion and feedback from banking institutions. These proposed changes aim to enhance customer security, simplify banking services, and ensure accountability of banks.

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Stricter Provisions on Cyber ​​Fraud

The RBI has stated that if a customer's account is subject to cyber fraud and they report it to the bank within three days, their liability will be considered zero, meaning the customer will not suffer any loss. Furthermore, if banks fail to take timely action in such cases, they could face a penalty of up to ₹25,000. This will require banks to be more vigilant regarding cybersecurity.

Relief for Customers in Locker Disputes

Significant changes have also been made in the interest of customers regarding locker disputes. If a customer's locker is stolen or damaged due to the bank's negligence or security lapse, the bank will have to pay compensation up to 100 times the locker rent.

KYC Process Simplified

The new rules have simplified the KYC (Know Your Customer) process. KYC for normal accounts will be required once every 10 years. This process will need to be completed every 8 years for medium-risk accounts and every 2 years for high-risk customers. This will relieve customers from the hassle of submitting documents repeatedly.

Improvements in Loan Rules

Customers have also been provided significant relief in loan-related matters. Now, all banks will be required to adopt a uniform formula for determining interest rates, ensuring transparency. Additionally, prepayment penalties (penalties for early repayment) on all loans will be completely eliminated. This will allow customers to repay their loans early without any additional charges.

Special Facility for Senior Citizens

A proposal has also been made to provide doorstep banking facilities to customers aged 70 years and above. This means they will not need to visit a bank branch; bank officials will provide essential services at home.

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When will the new rules be implemented?

The RBI has stated that after considering suggestions from the public and banks, these rules will be implemented between January 1, 2026, and April 1, 2026.These changes will increase transparency in the banking sector, improve customer experience, and make the banking system more accountable.