RBI issued amendments to the rules for advertising and selling financial products

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Highlights

RBI issued revised financial product advertising and sales guidelines for banks and NBFCs, which will come into effect from January 1, 2027.
The amendments include new provisions for the prevention of dark patterns and mis-selling, as well as for Direct Selling Agents and Direct Marketing Agents.
Changes in the regulation of agency business and referral services have tightened standards for distribution, marketing, and customer protection, which will impact operational processes.

This article was translated from the original. Read the original version by our correspondent here.

Scope and Timeline of the Revised Guidelines

Reserve Bank of India’s press release states that the central bank has issued the final amendments after reviewing stakeholder feedback on the draft revised guidelines released on February 11, 2026. This framework sets comprehensive instructions for banks and non-banking financial companies regarding the advertisement, marketing, and sale of financial products and services, including third-party products.

The amendments include provisions related to Direct Selling Agents, Direct Marketing Agents, dark patterns, and prevention of mis-selling. RBI has stated that changes based on the suggestions received have been incorporated into the final guidelines, while a summary of the feedback is provided in Annex I.

These second amendment guidelines apply to commercial banks, small finance banks, payments banks, local area banks, regional rural banks, urban and rural cooperative banks, all-India financial institutions, NBFCs, and housing finance companies. All amendments will be effective from January 1, 2027.

Impact on Agency Business and Referral Services

RBI has also issued amendments to the regulatory framework related to agency business and referral services provided by regulated entities. This step follows a review of feedback received on the proposed changes under the Reserve Bank of India (Undertaking of Financial Services) Directions, 2025.

The central bank stated that necessary changes based on the feedback have been included in the final amendment guidelines, details of which are provided in Annex II. The relevant amendments apply to commercial banks, small finance banks, payments banks, regional rural banks, urban and rural cooperative banks, and NBFCs.

This move further tightens standards for product distribution, customer protection, and responsible business conduct in India’s banking and financial services sector. The framework, effective from 2027, will impact institutions’ marketing methods, partnership models, and customer outreach processes at the operational level.

In our previous report, we discussed the steps taken by the government and RBI to increase foreign capital inflows, which included tax exemptions for FPIs on government bonds, expansion of the Fully Accessible Route, and measures to enhance foreign exchange liquidity. The article noted that these initiatives could somewhat ease pressure on the balance of payments and banking funding, although they are considered only a partial solution to structural challenges.

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