RBI’s mis-selling regulation is a welcome move. Customers walking into banks often get sold all sorts of financial products they don’t need or understand. Products like insurance and mutual funds are bundled with other products like loans. Then there are all sorts of dark patterns.

So now banks have to ask for your feedback on the products they sell within 30 days, and if you think you’ve been mis-sold, you can file a complaint within that period and get a full refund.

Btw, here’s a half tongue-in-cheek, galaxy-brained counterpoint from a colleague:

~50% of household financial assets are now in insurance/pension products and mutual fund investments. If not for mis-selling, would they have entered these markets on their own? Probably not. Mis-selling has done more for financial inclusion than all the financial literacy initiatives put together. Everybody in finance knows this but can’t admit openly😬

On a serious note, if financial education works to a limited extent and only greed (bull markets) and mis-selling work to get people into the markets, what can we do to change this?

Link to RBI press release.

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