When the bank disagrees with its Internal Ombudsman

An IO decision can be overruled only through the authority and Board-review path specified in the current direction.

Published by Finin2min · Updated 24 October 2026

How this provision works

For the commercial-bank direction, Competent Authority is the Whole Time Director/Executive Director in charge of the customer-service vertical. Clause 13(3) requires that authority’s approval to overrule an IO decision; a branch or operational manager’s disagreement is insufficient.
Every such overruled case must be placed before the Board’s Customer Service Committee for review. For NBFCs and CICs, use their own defined authority and committee rather than copying the bank’s office title.
The final customer communication must accurately state the outcome, IO review where applicable, and the available RBI escalation route. On RBI escalation the bank must supply the IO decision/comments under clause 14(13).

Practical illustration

A branch rejects an IO-recommended reversal. Unless the defined Competent Authority approves an override and it goes to the specified Board committee, the branch’s disagreement does not complete the required process.

The example is illustrative; it is not a reported company or court case.

Questions answered

Can any senior manager overrule the IO?

No. The approval must come from the direction’s defined Competent Authority.

Does an approved override remove later Board review?

No. Clause 13(4) separately requires placement of all such cases before the committee.

Primary source and edition

Commercial Banks Internal Ombudsman Directions 2026 and RB-IOS2026; separate NBFC and Credit Information Companies directions identified by actual title. Commercial Banks IO Directions 2026 clauses 4(1)(b),13(3)–(4),14(11)–(13).

Open the official instrument at this provision

Legal effect follows the instrument’s commencement and amendment provisions; a website upload date does not by itself change the law.

Related primary authorities

Scope and source editions

The public RBI Ombudsman Scheme 2026 applies from 1 July 2026, with the 2021 saving in clause 20. The internal-review explanation uses the Commercial Banks IO Directions of 14 January 2026 and compares specific NBFC/CIC differences where stated. Bank IO applicability generally requires 10 or more banking outlets at 31 March 2025, with a six-month rule for later qualification. NBFC internal-IO thresholds differ from external Scheme coverage. CIC source 13276 means Credit Information Companies; source 13274 means NBFCs and 13273 means Payments Banks.