Module: | KYC, NPAs, Advances & Investment Valuations
Q187: Scenario: Mr. Sharma falls victim to a bona fide electronic banking fraud of ₹40,000. He reports the incident to the National Cyber Crime Portal and his bank within 3 calendar days. He has never claimed such compensation before. Based on the 2026 Limiting Liability amendments, consider the following statements regarding the compensation metrics and cost apportionment:
1. Mr. Sharma is eligible for a maximum compensation of ₹25,000 since it is the lower of 85% of the net loss or ₹25,000, and he reported within the strict 5 calendar days timeline.
2. Out of the ₹25,000 compensation paid, the Reserve Bank of India (RBI) will bear a calculated contribution of exactly ₹19,118.
3. The customer's bank and the beneficiary bank will each contribute exactly ₹2,941 towards the ₹25,000 compensation payout.
4. The bank is granted a maximum of 10 calendar days to credit this specific compensation amount to his account after receiving the application.
Which of the statements given above is/are correct?
2. Out of the ₹25,000 compensation paid, the Reserve Bank of India (RBI) will bear a calculated contribution of exactly ₹19,118.
3. The customer's bank and the beneficiary bank will each contribute exactly ₹2,941 towards the ₹25,000 compensation payout.
4. The bank is granted a maximum of 10 calendar days to credit this specific compensation amount to his account after receiving the application.
Which of the statements given above is/are correct?
✅ Correct Answer: B
The correct answer is B. Statement 1 is correct: The updated framework introduces a lifetime, one-time compensation for bona fide small value frauds up to ₹50,000, capped mathematically at 85% of the net loss or ₹25,000, whichever is lower, provided the incident is reported within five calendar days.
Statement 2 is correct: For fraud losses falling between ₹29,412 and ₹50,000, the exact financial apportionment dictates that the Reserve Bank of India (RBI) bears a maximum burden of ₹19,118.
Statement 3 is correct: Under this exact same loss bracket, the remaining liability is split equally, meaning the customer's bank and the beneficiary bank must each contribute exactly ₹2,941.
Statement 4 is incorrect: The operational timeline has been drastically tightened, mandating that the bank must completely process and credit this specific compensation amount to the customer within a strict limit of five calendar days from receiving the application, not ten.
Statement 2 is correct: For fraud losses falling between ₹29,412 and ₹50,000, the exact financial apportionment dictates that the Reserve Bank of India (RBI) bears a maximum burden of ₹19,118.
Statement 3 is correct: Under this exact same loss bracket, the remaining liability is split equally, meaning the customer's bank and the beneficiary bank must each contribute exactly ₹2,941.
Statement 4 is incorrect: The operational timeline has been drastically tightened, mandating that the bank must completely process and credit this specific compensation amount to the customer within a strict limit of five calendar days from receiving the application, not ten.