Reserve Bank of India has revised and issued a uniform guidelines on Internet Banking.

The revised guidelines applicable to all the cooperative banks are as follows:

• All licensed StCBs, DCCBs and UCBs which have implemented Core Banking Solution (CBS) and migrate  to Internet Protocol Version 6 (IPv6) and complying with the guidelines prescribed in Annex-I to this circular may offer Internet Banking (View only) facility to their customers, without prior approval of RBI.

About Guidelines:

View Only facility:

• In case, any service offered under ‘view only’ facility requires two-factor authentication or One Time Password (OTP), banks may adopt the security features prescribed in Annex II of the circular.
• This facility is strictly for non-transactional services such as balance enquiry, balance viewing, account statement download, request for supply of cheque books, etc. and no online fund-based transactions are allowed.
• The cooperative banks have to report commencement of the service to the concerned Regional Office of RBI (and also NABARD in case of StCBs/DCCBs) within one month of operationalization of Internet Banking.
• StCBs/DCCBs which are already offering Internet Banking (View only) facility to their customers should immediately review their systems in the light of these guidelines and report to the concerned Regional Office of RBI (through NABARD), within one month from the date of issuance of this circular.

Transactional facility with Prior approval of RBI

• CRAR of not less than 10 per cent.
• Networth is Rs.50 crore or more as on March 31 of the immediate preceding financial year.
• Gross NPAs less than 7 % and Net NPAs not more than 3%
• The bank should have made a net profit in the immediate preceding financial year and overall, should have made net profit at least in three out of the preceding four financial years.
• It should not have defaulted in maintenance of CRR/SLR during the immediate preceding financial year.
• It has sound internal control system with at least two professional directors on the Board.
• The bank has a track record of regulatory compliance and no monetary penalty has been imposed on the bank for violation of RBI directives/guidelines during the two financial years, preceding the year in which the application is made.
• StCBs/DCCBs, which are already offering Internet Banking transactional services are advised to comply with the instructions contained in this circular and submit details of their business models, projections of cost/benefits, etc. and obtain post facto approval of the concerned Regional Office of RBI within one month from the date of issuance of this circular.

Other Points:

• The above stated banks will be allowed to extend Internet Banking with transactional facility provided they comply with the guidelines prescribed in Annex I and II to this circular.

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