The Ombudsman Scheme for Digital Transactions, 2019


The Reserve Bank of India (“RBI”) introduced an Ombudsman Scheme for Digital Transactions in 2019. The scheme, introduced under section 18 of Payment & Settlement Systems Act, 2007, aims to provide a cost-free and expeditious complaint redressal mechanism concerning deficiency in customer services in digital transactions conducted through non-bank entities regulated by RBI. From 12th November, 2021 it has been made a part of the Integrated Ombudsman Scheme. There are approximately 21 Ombudsmen for Digital Transactions, with their offices located in state capitals. 

Where can a complaint be filed?

In order to file a complaint under Digital Transaction, the complainant approaches the System Participant; however, if it does not reply within a period of one month, or the System Participant rejects the complaint, or if the complainant is not satisfied with the reply, the complainant can file the complaint with the Ombudsman within whose jurisdiction the System Participant is located. 

Grounds for complaint under Digital Transactions Ombudsman Scheme

The grounds on which the Ombudsman shall receive and consider complaints are:

  • Prepaid Payment Instruments: Non-adherence to the instructions of RBI by System Participants about Prepaid Payment Instruments Semi-Closed System on any of the following:
  • Failure in crediting merchant’s account within reasonable time
  • Failure to load funds within reasonable time in wallets/cards
  • Unauthorized electronic fund transfer
  • Non-Transfer or refusal to transfer or failure to transfer within reasonable time, the balance in the Prepaid Payment Instruments to the holder’s ‘own’ bank account or back to source at the time of closure, expiry of validity period etc., of the Prepaid Payment Instrument
  • Failure to refund within reasonable time/refusal to refund in case of unsuccessful/returned/rejected/cancelled/transactions
  • Non-credit/delay in crediting the account of the Prepaid Payment Instrument holder as per the terms and conditions of the promotions offer(s) from time to time, if any
  • Non-adherence to any other instruction of the RBI on Prepaid Payment Instruments.
  • Mobile/Electronic Fund Transfers: Non-adherence to the instructions of the RBI on Mobile/Electronic fund transfers by System Participants on any of the following:
  • Failure to effect online payment/fund transfer within reasonable time
  • Unauthorized electronic fund transfer
  • Failure to act upon stop-payment instructions within the time frame and under the circumstances notified to the customers within prescribed timeline
  • Failure to reverse the amount debited from customer account in cases of failed payment transactions within prescribed timeline
  • Non-adherence to any other instruction of the Reserve Bank on Mobile/Electronic fund transfers.

Instances in which one’s complaint be rejected by the Ombudsman?

  • If the System Participant against whom the complaint is registered, is not covered under the Scheme.
  • If one has not approached the System Participant concerned in the first instance for redressal of the grievance.
  • If the subject matter of the complaint is not pertaining to the grounds of complaint specified under Clause 8 of the Scheme.
  • If the complaint has not been made within one year from the date of receipt of reply from the System Participant; or if no reply is received, and the complaint to the Ombudsman is made after the lapse of more than one year and one month from the date of complaint to the System Participant. 
  • If the subject matter of the complaint is pending for disposal/has already been dealt with at any other forum like court of law, consumer court etc.
  • If the complaint is for the same subject matter that was settled through the office of the Ombudsman in any previous proceedings.
  • If the complaint is frivolous or vexatious.
  • The complaint falls under the disputes covered under Section 24 of the Payment and Settlement Systems Act, 2007.

The complaint pertains to dispute arising from a transaction between customers.

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