PM Modi launches 2 RBI schemes. All about the central bank initiatives

PM Modi said the schemes will expand the scope of investment in the country and make access to capital markets easier and more secure for investors.

Prime Minister Narendra Modi on Friday launched two customer-centric initiatives of the Reserve Bank of India (RBI)—the RBI Retail Direct Scheme and the Reserve Bank-Integrated Ombudsman Scheme. “The two schemes launched today will expand the scope of investment in the country and make access to capital markets easier and more secure for investors,” PM Modi said.

The RBI Retail Direct Scheme is aimed at enhancing access to the government securities market for retail investors. (File Photo)

“With the RBI Retail Direct Scheme, small investors in the country have got a safe medium of investment in government securities. With Reserve Bank-Integrated Ombudsman Scheme, 'One Nation, One Ombudsman System' has taken shape in the banking sector today,” he added after launching the schemes virtually.

What is the RBI Retail Direct Scheme?

The Prime Minister's Office (PMO) said in a statement on Thursday that the RBI Retail Direct Scheme is aimed at enhancing access to the government securities market for retail investors.

It offers them a new avenue for directly investing in the securities issued by the Centre and the state governments. “Investors will be able to easily open and maintain their government securities account online with the RBI, free of cost," the PMO said.

The scheme, leveraging technological advancements, offers a portal avenue to invest in central government securities, treasury bills, state development loans and Sovereign Gold Bonds (SGBs). The scheme places India in a list of select few countries offering such a facility.

RBI governor Shaktikanta Das, while flagged this initiative in a February policy review, called it a “major structural reform”. The central bank said in July that investors will have access to bidding in primary auctions as well as its trading platform for government securities called Negotiated Dealing System-Order Matching Segment (NDS-OM).

What is the Reserve Bank-Integrated Ombudsman Scheme?

The PMO statement said that the Reserve Bank-Integrated Ombudsman Scheme (RB-IOS) is aimed at further improving the grievance redress mechanism for resolving customer complaints against entities regulated by the central bank.

"The central theme of the scheme is based on 'One Nation-One Ombudsman' with one portal, one email and one address for the customers to lodge their complaints," the PMO release said. “There will be a single point of reference for customers to file their complaints, submit the documents, track status and provide feedback. A multi-lingual toll-free number will provide all relevant information on grievance redress and assistance for filing complaints,” it added.

The RBI, after review, decided to integrate the three ombudsman schemes into one and also simplified the scheme by covering all complaints involving deficiency in service by centralising the receipt and initial processing of complaints to enhance process efficiency.

The central bank’s alternate grievance redress mechanism currently comprises three ombudsman schemes—the Banking Ombudsman Scheme (BOS), launched in 1995, the Ombudsman Scheme for Non-Banking Financial Companies (OS-NBFC), 2018 and the Ombudsman Scheme for Digital Transactions (OSDT), 2019.

The PMO release said that there will be a single point of reference for the customers to file their complaints, submit documents, track the status of their complaints and provide feedback. A multi-lingual toll-free phone number will provide all the relevant information on grievance redress and assistance for filing complaints, it added.

RB-IOS will do away with the jurisdictional limitations as well as limited grounds for complaints. RBI will provide a single reference point for the customers to submit documents, track status of complaints filed and provide feedback.

The complaints that are not covered under the ombudsman scheme will continue to be attended to by the Customer Education and Protection Cells (CEPCs) located in RBI’s 30 regional offices.