RBI Expands Integrated Ombudsman Scheme for Financial Entities

RBI INTEGRATED Ombudsman Scheme: EXPANDED COVERAGE

Synopsis

The Reserve Bank of India (RBI) has broadened the scope of its Integrated Ombudsman Scheme (RB-IOS), effective from November 1, 2025, to include state and central co-operative banks, non-banking financial companies (NBFCs), and credit information companies. This unified mechanism allows consumers to raise complaints against any regulated financial entity for issues like poor service, delayed payments, or misinformation. The move strengthens consumer protection, enhances transparency, and builds trust across India’s financial ecosystem — especially for rural depositors and cooperative sector customers.

1. What is the Integrated Ombudsman Scheme?

Introduced in November 2021, the RBI’s Integrated Ombudsman Scheme (RB-IOS) serves as a unified grievance redress system for customers of banks and other regulated entities. It replaced the earlier separate ombudsman schemes for banks, NBFCs, and digital transactions with a single streamlined framework.

Objective: To provide a cost-free, transparent, and quick resolution mechanism for consumers’ complaints against financial institutions regulated by the RBI.

Example: If a customer’s complaint about an unauthorized debit or deficient banking service is not resolved within 30 days, they can file it under this scheme for further action.

2. What is New in the Recent Expansion?

Starting November 1, 2025, the RBI has expanded the RB-IOS to cover:

- All commercial banks and regional rural banks (RRBs) with deposits of ₹50 crore or more.
- State and central co-operative banks and scheduled urban co-operative banks.
- NBFCs (excluding housing finance companies) with assets of ₹100 crore or more.
- Credit information companies such as CIBIL and Experian.

Example: A depositor facing issues with a district co-operative bank or a borrower whose credit report on CIBIL contains errors can now approach the RBI Ombudsman for redressal.

3. Why is This Expansion Important?

- Consumer Protection: Extends RBI-led grievance redress to rural and co-operative bank customers.
- Financial Inclusion: Expands accountability across India’s smaller banks and NBFCs.
- Transparency: Promotes uniform complaint handling and monitoring via a single online portal — the Complaint Management System (CMS).
- Improved Trust: Strengthens confidence among small depositors and borrowers in the formal financial network.

4. How Does the Ombudsman System Work?

1. The customer first files a complaint with their respective bank or NBFC.
2. If the issue remains unresolved after 30 days, they may escalate it to the RBI Ombudsman via the official portal https://cms.rbi.org.in.
3. The Ombudsman investigates and delivers a decision, which the financial institution must comply with.

Example: If a rural customer’s fixed deposit interest is incorrectly credited and the local co-operative bank fails to correct it, the Ombudsman can direct the bank to provide compensation.

5. Related Recent Actions by RBI

- Superseded: The board of Irinjalakuda Town Co-operative Bank for poor governance practices.
- Cancelled Licence: Jijamata Mahila Sahakari Bank (Satara, Maharashtra) for failing to maintain capital adequacy and earning norms.

These actions reflect RBI’s increasing oversight and accountability requirements for smaller co-operative institutions under its strengthened monitoring framework.