RBI’s 2026 Framework on Advertising, Marketing & Sales by Regional Rural Banks

The Reserve Bank of India has proposed a robust set of regulatory changes governing how Regional Rural Banks (RRBs) advertise, market and sell financial products and services. These Draft Reserve Bank of India (Regional Rural Banks – Responsible Business Conduct) Amendment Directions, 2026 are to be read with the existing Reserve Bank of India (Regional Rural Banks – Responsible Business Conduct) Directions, 2025 and will take effect from July 1, 2026.

Issued under Section 35A of the Banking Regulation Act, 1949, these amendments are designed to strengthen consumer protection, ensure fair sales practices, and curb mis-selling, compulsory bundling and deceptive digital design (dark patterns) in the rural banking ecosystem.

Statutory foundation

  • The Reserve Bank of India has invoked its powers under Section 35A of the Banking Regulation Act, 1949.
  • The Amendment Directions are framed in public interest to regulate:
    • Advertising
    • Marketing
    • Sale of financial products / services
      by RRBs, including their agents.

Title and commencement

  • The instrument is titled:
    “Reserve Bank of India (Regional Rural Banks – Responsible Business Conduct) Amendment Directions, 2026”.
  • Effective date: July 1, 2026.
  • The Directions amend and supplement the existing Reserve Bank of India (Regional Rural Banks – Responsible Business Conduct) Directions, 2025.

Applicability

  • Applicable to:
    • All RRBs collectively (referred to as “RRBs”),
    • Each RRB individually.
  • Covers:
    • Own products / services of RRBs, and
    • Third-party Financial Product or Service distributed or referred by RRBs.

2. Key New Definitions Introduced

The Amendment Directions substantially expand the definitional framework in paragraph 4 of the 2025 Directions.

2.1 Compulsory bundling – what is prohibited

A new sub-paragraph 4(6A) defines Compulsory bundling:

  • It occurs when:
    • An RRB makes access to one product / service conditional upon availing another product / service,
    • Whether the additional product / service is its own offering or that of a third party.
  • This practice is barred as an element of mis-selling.

Permitted package offerings
Bundled offerings are allowed only when:

  • The assessee gives voluntary consent, and/or
  • Additional products / services are provided complimentarily, with no extra direct or indirect cost to the customer.

2.2 Dark pattern – deceptive digital design

Sub-paragraph 4(10B) defines Dark pattern as:

  • Any manipulative user interface or user experience tactic that:
    • Misleads or tricks users into actions they did not intend,
    • Undermines consumer autonomy, decision-making, or choice,
    • Results in misleading advertisement, unfair trade practice or infringement of consumer rights.

This directly aligns RRB obligations with the ‘Guidelines for Prevention and Regulation of Dark Patterns, 2023’ issued by the Central Consumer Protection Authority (CCPA).

2.3 Direct Selling Agent / Direct Marketing Agent

Sub-paragraph 4(10C) clarifies:

  • Direct Selling Agent (DSA) / Direct Marketing Agent (DMA) are:
    • Individuals or entities engaged by an RRB to market or sell:
      • The RRB’s own products / services, or
      • Third-party Financial Product or Service.

These agents fall squarely under the RRB’s governance, conduct and compliance framework.

Sub-paragraph 4(13A) introduces Explicit consent:

  • Defined as:
    • A specific, informed and unambiguous indication of the customer’s will,
    • Given through a clear statement or affirmative action,
    • Pertaining to a particular transaction or arrangement with the RRB.
  • The RRB is required to:
    • Record or document such consent,
    • Ensure consent is not bundled or implied.

2.5 Mis-selling – broader concept and illustrations

Sub-paragraph 4(20A) sets out a widened definition of Mis-selling, including the following illustrative cases:

  1. Selling a product / service that is:
    • Unsuitable or inappropriate for the customer’s profile,
    • Even if explicit consent has been obtained.
  2. Selling without providing correct or complete information, or by providing misleading information.
  3. Selling without obtaining explicit consent.
  4. Compulsory bundling along with a requested product / service.
  5. Any conduct categorized as mis-selling by the relevant financial sector regulator.

2.6 Third-party Financial Product or Service

Sub-paragraph 4(26A) defines:

  • Third-party Financial Product or Service as:
    • Any product / service offered by an RRB to customers on behalf of a third party,
    • Under an agency, referral or similar arrangement.

This captures, for example, insurance, mutual funds, pension products or other financial offerings distributed via RRB channels.

3. New Comprehensive Framework: Advertising, Marketing and Sales (Chapter IV – F)

A new Segment F: Advertising, Marketing and Sales of Financial Products / Services by RRBs is inserted under Chapter IV (Customer Guidance and Protection), starting with paragraph 136A.

3.1 Board-approved policy – central governance requirement

3.1.1 Policy on marketing and sales (136A)

Each RRB must adopt a comprehensive policy approved by its Board, covering: