The Supreme Court has given an important verdict giving great relief to the account holders. The court said that if an unauthorized and fraudulent online transaction takes place from a customer's account, and he files a complaint within three days under the guidelines of the Reserve Bank of India (RBI), then the bank will have to compensate for that loss. Amidst the increasing fraud in digital banking and online transactions, this decision will provide security and confidence to the customers.
Bank's responsibility to be vigilant
A bench of Justice J.B. Pardiwala and Justice R. Mahadevan said that banks should use the available technologies to detect and prevent unauthorized and fraudulent transactions. Also, customers were also advised to be vigilant and not share OTP with anyone. The court clarified that in some cases the negligence of the customer can also be brought under investigation.
Order of compensation of Rs 94,204
Under this decision, State Bank of India (SBI) has been ordered to pay compensation of Rs 94,204 to a customer. The case was related to the unauthorized transaction that took place on 18 October 2021. The Supreme Court dismissed SBI's petition, upholding the decision of the Guwahati High Court. The High Court had found that there was no negligence on the part of the customer.
Important message for customers
This decision not only encourages customers to lodge complaints on time, but also forces banks to further strengthen their security system. Customers will now be assured that appropriate action will be taken on their complaints and the loss will be compensated.