RBI Proposes Landmark 85% Compensation for Digital Fraud Victims to Boost Consumer Safety

Research Bank of India (RBI) released draft guidelines on 6 March 2026. These guidelines were presented with the aim of proposing a new compensation framework for protecting customers from digital fraud. This proposal is expected to come into effect from digital from 1 July 2026. Several consumer-protection measures designed to reduce the financial burden on victims of online banking fraud and ensure stronger accountability from banks. A key provision of this framework is that customers may receive compensation for up to 85% of the amount lost in a fraud or a maximum of ₹25,000, whichever is lower. Also, the scheme introduces a cost-sharing model focusing on small-value fraud cases where the financial burden of compensation will be distributed among stakeholders.