State Bank has received a number of representations from the banks’ account holders/customers complaining that banks have started imposing certain premium/charges under the head “insurance covers” on their consumer products, viz., credit cards, Debit/ATM cards, etc without obtaining prior consent in writing from them.

2. The matter has been examined and it has been decided that henceforth no bank/DFI shall charge any amount under the head of “insurance premium” (by what so ever name called) without obtaining the consent of each existing & prospective customer in writing. In addition to obtaining consent in writing, the banks/DFIs may also use the following modes for obtaining prior consent of their customers provided proper record is maintained by banks/DFIs:-

i) Customer’s consent on recorded lines via out bound/in bound call center (after due verification)
ii) ATM screens – screen pop up before conducting transaction and after inputting pin code
iii) Signed consent acquired with credit card application or as separate form
iv) IVR (Integrated Voice Recording)

3. Any violation or circumvention of the above instructions will attract penal action under provisions of BCO, 1962. State Bank will also check compliance with the above instructions during regular inspection of banks/DFIs.