The Supreme Court (SC) has said banks and other financial institutions must be held accountable for losses suffered by victims of digital fraud.
The court observed that victims of offences such as digital arrest scams should receive compensation of at least the amount lost if the fraud is found to have resulted from a financial institution’s failure to exercise due diligence.
A bench comprising Chief Justice Surya Kant and Justices Joymalya Bagchi and V. Mohana said, it will examine the Reserve Bank of India’s proposed Know Your Customer (KYC) Amendment Directions, 2026.
The directions are expected to be notified by 30th of November and made operational by 31st of December. The bench stressed that the proposed regulatory framework must provide for appropriate compensation when financial institutions are found to have failed in their due diligence obligations.
The apex court directed the RBI to submit a list of all authorised financial institutions by the next date of hearing. It said the court could issue directions applicable to all such institutions without necessarily impleading individual banks in the proceedings.
(ADVERTORIAL DISCLAIMER: The above release has been taken from News on Air. No editors from The Mainstream were involved in creation of this content.)
Also read: Viksit Workforce for a Viksit Bharat
Do Follow: The Mainstream LinkedIn | The Mainstream Facebook | The Mainstream Youtube | The Mainstream Twitter
About us:
The Mainstream is a premier platform delivering the latest updates and informed perspectives across the technology business and cyber landscape. Built on research-driven, thought leadership and original intellectual property, The Mainstream also curates summits & conferences that convene decision makers to explore how technology reshapes industries and leadership. With a growing presence in India and globally across the Middle East, Africa, ASEAN, the USA, the UK and Australia, The Mainstream carries a vision to bring the latest happenings and insights to 8.2 billion people and to place technology at the centre of conversation for leaders navigating the future.