Stronger Protection Against Mis-selling
In a significant move to bolster consumer rights, the Reserve Bank of India (RBI) is implementing a new framework to curb the mis-selling of financial products. Effective today, these rules mandate that customers who are sold financial products through
misleading or incorrect advice are entitled to a full refund and compensation for any resulting losses. Banks will now face stricter accountability for how products like loans, insurance, and investments are sold. The regulations also place new restrictions on promotional calls and messages from banks, aiming to create a more transparent and customer-friendly environment.
New Rules for Credit Card Holders
Several banks are updating their credit card policies. HDFC Bank cardholders, for instance, now face a spend-based requirement for complimentary airport lounge access. To get three free domestic lounge visits in a quarter, users must have spent at least Rs 60,000 in the preceding quarter. Similarly, SBI Card has revised the reward points program for its co-branded PhonePe cards, changing how points are earned and expanding the list of transactions that do not qualify for rewards. Cardholders are advised to review their statements and the updated terms and conditions from their respective banks to understand how these changes affect their benefits.
Lending Tightens for Stock Brokers
The RBI is also enacting stricter regulations on how banks can lend to stock and commodity brokers, specifically targeting proprietary trading where firms trade with their own capital. From July 1, all loans to these market intermediaries must be 100% collateralized. Furthermore, if a broker uses equities as collateral, the bank can only lend 60% of their value, a significant tightening of credit. The central bank's goal is to reduce speculative behaviour in the market and enhance the stability of the banking sector by protecting depositors' funds from high-risk lending.
Tax Filing Season in Full Swing
While not a new rule taking effect today, July 1 marks the start of the final month for most individual taxpayers to file their Income Tax Returns (ITR) for the 2025-26 financial year. The deadline for salaried individuals and those who do not need their accounts audited (filing ITR-1 and ITR-2) remains July 31, 2026. Missing this deadline can attract a penalty of up to Rs 5,000 and limit the ability to carry forward losses. Tax experts advise filers to gather all necessary documents, such as Form 16 and bank statements, to ensure a smooth and timely filing process.
Aadhaar Update Made Free for a Limited Time
In a welcome move for citizens, the Unique Identification Authority of India (UIDAI) has waived the fee for updating the email address linked to an Aadhaar card. This service, which typically costs Rs 75, will be free of charge from July 1 until December 31, 2026, when done through the official Aadhaar mobile application. This six-month window is a good opportunity for individuals to ensure their contact details are current, which is crucial for receiving important communications and OTPs for various government and financial services.
