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Foreign banks set to dial diplomatic missions over RBI directive

Curbs on multiple current accounts seen as unfair trade practice

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Illustration by Binay Sinha

3 min read Last Updated : Oct 31 2020 | 6:05 AM IST

Foreign banks are set to move their diplomatic missions against the Reserve Bank of India’s (RBI’s) directive that bars borrowers from opening multiple current accounts, with the lenders alleging that this amounts to an “unfair trade practice”.

The banking regulator’s decision, taken in August to curb the rampant fund diversion among borrowers, severely hampers the lucrative cash management business of foreign banks in particular.

A clutch of leading multinational companies (MNCs) and domestic firms are currently engaged with their legal advisors on the recourse available to them. This is only to get a sense of the options on the table, and the

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