Banks and financial institutions have received warning from Reserve Bank of India regarding strict accordance of its guidelines on credit cards related to transparency and levying of interest rates and charges on them. RBI has warned of strict penalty if its guidelines are not followed by banks.
"All banks are once again advised to strictly adhere to the guidelines... both in letter and spirit," an RBI circular said.
The new directives have been issued in line with innumerable complaints being received from customers.
The RBI circular issued in 2007 said that banks msut mention an upper ceiling on the rate of interest along with processing fees and other charges and also mention their method of calculation of the finance charges.
Credit cards are being issued by a host of banks including ICICI Bank, HDFC Bank, SBI Cards, Punjab National Bank and many foreign banks like Standard Chartered, HSBC and Citibank.