It appears that HDFC Bank is setting its own rules, possibly even overstepping the clear directions laid out by the Reserve Bank of India (RBI) in its 2022 Master Direction on credit cards.
A TechnoFino Community member recently pointed out that HDFC Bank explicitly states in its credit card terms and conditions that it “reserves the right to cancel the credit card in case the card remains inactive and is not used for effecting any transaction for a continuous period of 6 (six) months.”
Now here’s the issue: according to the RBI’s "Master Direction – Credit Card and Debit Card – Issuance and Conduct Directions, 2022", the regulator clearly mandates that if a credit card remain inactive for a continuous period of 12 months then the bank can initiate closure, but before that, the bank is required to notify the customer via SMS or email, giving them a 30-day window to respond or make a transaction to keep the card active. Only after this notice period, and a continued lack of activity or response, can the bank proceed with cancellation.
So the question arises:
How is HDFC Bank enforcing cancellation at just 6 months of inactivity when RBI guidelines clearly allow customers 12 months?
More importantly, when all other banks are adhering to the RBI-mandated 12-month rule, how is HDFC justified in enforcing stricter terms? While banks do have the liberty to define certain operational policies, they are not permitted to override explicit regulatory directives.
This situation raises concerns about transparency and regulatory compliance. Customers deserve to know whether their card usage is being governed by RBI's rules or the bank’s internal interpretations - and whether such actions are even permitted under the law.
We hope HDFC Bank will clarify its stance or align its policy with RBI’s directions, like other responsible issuers.
A TechnoFino Community member recently pointed out that HDFC Bank explicitly states in its credit card terms and conditions that it “reserves the right to cancel the credit card in case the card remains inactive and is not used for effecting any transaction for a continuous period of 6 (six) months.”
Now here’s the issue: according to the RBI’s "Master Direction – Credit Card and Debit Card – Issuance and Conduct Directions, 2022", the regulator clearly mandates that if a credit card remain inactive for a continuous period of 12 months then the bank can initiate closure, but before that, the bank is required to notify the customer via SMS or email, giving them a 30-day window to respond or make a transaction to keep the card active. Only after this notice period, and a continued lack of activity or response, can the bank proceed with cancellation.
So the question arises:
How is HDFC Bank enforcing cancellation at just 6 months of inactivity when RBI guidelines clearly allow customers 12 months?
More importantly, when all other banks are adhering to the RBI-mandated 12-month rule, how is HDFC justified in enforcing stricter terms? While banks do have the liberty to define certain operational policies, they are not permitted to override explicit regulatory directives.
This situation raises concerns about transparency and regulatory compliance. Customers deserve to know whether their card usage is being governed by RBI's rules or the bank’s internal interpretations - and whether such actions are even permitted under the law.
We hope HDFC Bank will clarify its stance or align its policy with RBI’s directions, like other responsible issuers.
