The Reserve Bank of India (RBI) has released guidelines for the appointment and operations of internal ombudsmen in banks and NBFCs. These guidelines aim to enhance the resolution of customer complaints efficiently. The RBI has provided specific directions for various entities like commercial banks, small finance banks, payments banks, NBFCs, and credit information companies to ensure clarity within each sector.
To be eligible for the role of internal ombudsman, the candidate must be a retired or serving officer equivalent to a General Manager in the relevant entity. They should possess a minimum of seven years of experience in areas such as banking, finance, regulation, supervision, or consumer protection. Every regulated entity is required to appoint at least one internal ombudsman to address complaints that were partially resolved or rejected by the entity.
The internal ombudsman will focus on customer service and grievance redressal. The Department of Supervision at the RBI will oversee the implementation of these guidelines and review the entities’ performance in these areas. The RBI had initially issued a draft Master Direction on Internal Ombudsman in 2025, seeking feedback from stakeholders. The final Master Direction incorporates necessary modifications based on the feedback received.
