After receiving a huge volume of complaints related to payments, the Reserve Bank of India has been mulling to establish an alternate redressal structure.
The central bank is planning to establish an ombudsman for digital payments by March. It would work akin to banking ombudsman currently functioning in the system, said ET report quoting two senior bankers aware of the development.
With separate ombudsman in place, complaints regarding failed payments, which will not be addressed by payment firm, can be taken to the ombudsman directly.
The Ombudsman office would be created by early next year.
With digital transactions gaining at a rapid pace over the past year, multiple issues such as failed transactions or funds sent to the wrong address have been cropping up as well, added the bankers. The move is also to curb fraud practices in the payment system.
Earlier in August, RBI had mentioned the same in its annual report.
The increasing volume of complaints involving digital payments being received by the offices of the banking ombudsman and a large number of prepaid payment instruments issued by banks and non-bank issuers have necessitated the establishment of a separate ombudsman for digital transactions, it had said.
The payment and settlement systems recorded robust growth in 2017-18, with volume and value growing at 44.6 per cent and 11.9 per cent, respectively, on top of an increase of 56.0 per cent and 24.8 per cent, respectively, in 2016-17. The share of electronic transactions in the total volume of retail payments increased to 92.6 per cent in 2017-18, according RBI Annual Report for 2017-18.
In October 2017, RBI through ‘Master Direction on Issuance and Operation of Prepaid Payment Instruments (PPIs)’ document had asked mobile wallet issuers and non-banking payments entities to create a publicly disclosed customer grievance redressal framework.