Do you want to close your credit card? Check out the new RBI regulations here
Visa credit cards. AP file
Today, getting a credit card is simple, but getting rid of it requires following certain procedures. According to new regulations from the Reserve Bank of India, credit card companies are required to comply with customer shutdown requests. Credit card agents do their best to convince users to keep their cards in order to retain them as customers. They offer a number of incentives, including the ability to increase credit limit and a waiver of annual card fees. Also, it usually takes the company two to three confirmation calls once the customer is sure they want to close the credit card before the card is actually closed.
The RBI’s “Main Directorate – Credit Card and Debit Card – Issuance and Conduct Instructions, 2022” requires credit card providers to honor all requests for cancellation of credit cards. As long as the client has settled all remaining debts, the closing must be completed within seven days. “Immediately after the credit card is closed, the cardholder must be informed by email, SMS, etc. The ability to request the closure of a credit card account through various channels, including telephone support, a dedicated email address, Interactive Voice Response (IVR), a clearly visible link on the website, banking services via the Internet, mobile application or any other mode, must be made available to cardholders,” the RBI instructions add.
The RBI has further ruled that credit card companies cannot compel users to send messages with close requests. If a credit card company does not terminate the card within seven working days of the customer’s request, it would be liable to a fine of Rs 500 per day.
The card issuer can begin the process of closing the credit card account after notifying the cardholder if a credit card has not been used for over a year. If the cardholder does not respond within 30 days, the card issuer may cancel the account after the customer has paid all outstanding debts.
Within 30 days of closing the card, the card issuer must notify the credit reporting company. Any credit balance remaining after the credit card account is closed must be transferred to the cardholder’s bank account.