A credit card user received a hefty Rs 3.21 lakh compensation after a private bank failed to close credit card on time.
In a viral Reddit post titled, ‘Got Rs 3.21 lakh compensation from Kotak Mahindra Bank for not closing my credit card’, the user detailed that he sought to close two credit cards in May last year after the bank reduced the credit limit from Rs 1 lakh to Rs 10,000. Instead of closing the cards, the bank levied an annual fee.
The user then complaint to higher authorities. After raising the issue, the bank said the cards were never closed and thus ensued another round of sending emails without any response. Frustrated, the user filed complaint to the Banking Ombudsman.
The bank’s officer called customer and said: “It’s your mistake. Closure requests are not accepted via email, you should have called”. But I had already submitted a written closure request. Sent follow-ups. Received no response from the bank.”
The user said the bank finally paid a compensation of Rs 3,21,000. But what are RBI guidelines regarding credit card closure? Let’s understand.
According to RBI guidelines, if a bank fails to close a credit card within 7 working days of a customer’s request (provided all dues are cleared), the issuer must pay a penalty of ₹500 per day of delay to the customer.
If a bank fails to follow the guidelines, customers can raise a complaint. The first step is to complain to the bank’s nodal officer. If no resolution is provided within 30 days, customers can approach the RBI Ombudsman.
