CHENNAI: Banks should keep their customers' personal information confidential unless explicit consent is given for sharing it, according to the Reserve Bank of India's (RBI) Charter of Customer Rights.

The RBI released its Charter of Customer Rights spelling out the broad principles for protection of bank customers and their five basic rights: (a) right to fair treatment, (b) right to transparency, fair and honest dealing, (c) right to suitability, (d) right to privacy, and (e) right to grievance redress and compensation.

According to the new charter, banks should keep the personal information of customers confidential unless they have offered specific consent to the bank or such information is required to be provided under a law or it is provided for a mandated business purpose.

"The customer should be informed upfront about likely mandated business purposes. Customers have the right to protection from all kinds of communications; electronic or otherwise, which infringe upon their privacy," the charter noted.

According to the RBI, banks must communicate their policy for compensating mistakes, lapses in conduct, as well as non-performance or delays in performance, whether caused by the provider or otherwise.

The policy must lay out the rights and duties of the customer when such events occur.

The RBI has advised the Indian Banks' Association (IBA) and the Banking Codes and Standards Board of India (BCSBI) to formulate a "Model Customer Rights Policy" encapsulating the principles enshrined in the Charter.

According to the RBI, initially, all the scheduled commercial banks, regional rural banks and urban co-operative banks are expected to prepare their own board-approved policy incorporating the five basic rights of the Charter which, among other things, would contain a monitoring and oversight mechanism for ensuring adherence.

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