Reserve Bank of India (Rural Co-operative Banks – Debit Cards: Issuance and Conduct) Directions, 2025

RBI/DOR/2025-26/303
DOR.AUT.REC.No.222/24-01-041/2025-26

November 28, 2025

Reserve Bank of India (Rural Co-operative Banks – Debit Cards: Issuance and Conduct) Directions, 2025

Table of Contents

Chapter I – Preliminary
Chapter II – Board Approved Policy and Procedures
Chapter III – Issue of Debit Card by Banks
Chapter IV – Form Factor
Chapter V – Co-branding Arrangement
Chapter VI – General Guidelines for Debit Cards
Chapter VII – Repeal and Other Provisions

In exercise of the powers conferred by Section 35A and Section 56 of the Banking Regulation Act, 1949 and all other provisions / laws enabling the Reserve Bank of India (‘RBI’) in this regard, RBI being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Directions hereinafter specified.

Chapter I – Preliminary

A. Short Title and Commencement

1. These Directions shall be called the Reserve Bank of India (Rural Co-operative Banks Debit Card – Issuance and Conduct) Directions, 2025.

2. These Directions shall come into force with immediate effect.

B. Applicability

3. These Directions shall be applicable to all Rural Co-operative Banks (hereinafter collectively referred to 'banks' or ‘RCBs’ and individually as a 'bank' or ‘RCB’).

In this context, Rural Co-operative Banks shall mean State Co-operative Banks and Central Co-operative Banks, as defined in the National Bank for Agriculture and Rural Development Act, 1981.

4. These directions cover the general and conduct regulations relating to debit cards (including co-branded debit cards) which shall be read along with prudential, payment and technology & cyber security related directions applicable to debit and co-branded debit cards, as issued by the Reserve Bank.

C. Definitions

5. In these Directions, unless the context otherwise requires, the terms herein shall bear the meanings assigned to them below:

Cardholder
is a person to whom a card is issued or one who is authorized to use an issued card.

Card-issuer
is a bank which issues debit cards.

Card Loyalty / Reward Programme/s
are those schemes linked to a debit card whereby the card-issuer or associated merchant establishments, upon use of the card/s, offer digital coupons, points, discounts, cash backs or other benefits having monetary value that can be used / redeemed for the same transactions or other future transactions after accumulation.

Co-branded Card
is a card that is issued jointly by a card-issuer and a co-branding entity bearing the names of both the partnering entities.

Convenience Fee
is a fixed or pro-rata charge on use of debit cards as one of the alternative forms of payment which is not ordinarily accepted vis-à-vis other forms of payment.

Debit Card
is a physical or virtual payment instrument containing a means of identification, linked to a Savings Bank / Current Account which can be used to withdraw cash, make online payments, do PoS terminal/Quick Response (QR) code transactions, fund transfer, etc. subject to prescribed terms and conditions.

Form Factor
is the physical or virtual instrument that can be used in place of a card to undertake a payment / banking transaction.

Prepaid Card
is a Prepaid Payment Instrument as defined in the Master Direction on Prepaid Payment Instruments dated August 27, 2021.

6. All other expressions unless defined herein shall have the same meaning as have been assigned to them under the Banking Regulation Act, 1949 or the Reserve Bank of India Act, 1934 or any statutory modification or re-enactment thereto or as used in commercial parlance, as the case may be.

Chapter II – Board Approved Policy and Procedures

7. A bank shall formulate comprehensive policy / policies and procedures with the approval of its Board covering, inter alia, the following aspects:

• Debit card issuance.
• Co-branding arrangement (as applicable).
• Standard operating procedure for discretionary blocking / deactivating / suspending a debit card.
• Time period for completion of formalities after blocking a lost card.
• Redressal of grievances and compensation framework.

8. The specific aspects to be addressed in these policies / procedures are detailed in the relevant paragraphs of these Directions.

Chapter III – Issue of Debit Card by Banks

A. Issue of Debit Card

9. A bank shall formulate a Board-approved comprehensive debit cards issuance policy and issue debit cards in accordance with the same. Prior approval of the Reserve Bank is not necessary for banks desirous of issuing debit cards to their customers.

10. Debit cards shall only be issued to customers having Savings Bank / Current Accounts.

11. A bank shall not issue debit cards to cash credit / loan accounts. However, it will not preclude the banks from linking the overdraft facility provided along with Pradhan Mantri Jan Dhan Yojana accounts or Kisan Credit Card accounts with a debit card.

12. A bank shall not force a customer to avail debit card facility and shall not link issuance of debit card to availment of any other facility from the bank.

B. Review of operations

13. The bank shall undertake review of its operations / issue of debit cards on half-yearly basis. The review shall include, inter-alia, card usage analysis including cards not used for long durations and the inherent risks therein.

Chapter IV – Form Factor

A. Issue of Form Factor

14. Card-issuers may issue other form factors in place of / in addition to a plastic debit card such as wearables, after obtaining explicit consent from the customer.

15. Form factors shall be subject to all the specific and general guidelines applicable to the respective cards.

16. Card-issuers shall provide options for disabling or blocking the form factor in line with the instructions issued by the Reserve Bank from time to time.

Chapter V – Co-branding Arrangement

A. Board approved policy

17. The co-branding arrangement shall be as per the Board approved policy of the card-issuer. The policy shall specifically address issues pertaining to various risks, including reputation risk associated with such an arrangement and put in place suitable risk mitigation measures. Further, the information relating to revenue sharing between the card-issuer and the cobranding partner entity shall be indicated to the cardholder and also displayed on the website of the card-issuer.

B. Issue of Co-branded Cards

18. Prior approval of the Reserve Bank is not necessary for the issuance of co-branded debit cards / co-branded prepaid cards by banks subject to conditions stipulated under this chapter. However, RCBs shall not issue debit cards in tie-up with other non-bank entities. In addition to the conditions listed herein, the co-branding arrangement for debit cards and prepaid cards shall also be subject to the specific conditions applicable to such cards.

19. The co-branded card shall explicitly indicate that the card has been issued under a cobranding arrangement. The co-branding partner shall not advertise / market the cobranded card as its own product. In all marketing/advertising material, the name of the card-issuer shall be clearly shown.

20. The co-branded card shall prominently bear the branding of the card-issuer.

21. A card-issuer can partner with more than one co-branding partner for a card.

C. Due diligence

22. Card-issuers shall carry out due diligence in respect of the co-branding partner entity with which they intend to enter into tie-up for issue of such cards to protect themselves against the reputation risk they are exposed to in such an arrangement. Card-issuers shall ensure that in cases where the proposed co-branding partner is a financial entity, it has obtained necessary approvals from its regulator for entering into the co-branding arrangement.