Credit card lost, someone else spent all the money—who pays? You or the bank? What do the rules say?

If you lose your credit card and someone subsequently makes a transaction that you did not authorize, the primary question arises: who is liable for the amount—you or the bank? The answer depends on how quickly you notified the bank about the transaction and when you had the card blocked.

The first step upon losing a credit card should be to block it immediately. Even if you merely suspect that the card has been misplaced, it is advisable to freeze it temporarily. Nowadays, almost all banks offer facilities to instantly deactivate the card via their mobile apps, websites, or helplines.

Do you have to pay if a transaction occurs after the card is lost?
The cardholder is not always held liable for fraudulent transactions. Liability depends on the cause of the fraud and the speed with which the customer informed the bank. Once the bank has been notified of the loss and the card has been blocked, the bank generally bears the liability for any subsequent transactions. However, for transactions that occurred before the card was blocked, RBI regulations and the bank's customer protection policy apply.

Zero liability if the complaint is filed within 3 working days
According to RBI guidelines, the customer is not liable if the transaction occurred due to the bank's error, negligence, or deficiency. Furthermore, if a breach in the payment system occurs due to a third party—involving no fault of either the bank or the customer—the customer is not held liable. To avail of this protection, the customer must report the incident to the bank within three working days of receiving notification of the transaction.

It is important to note a crucial detail here: these three days are not counted from the date the card was lost. The timeline begins after receiving notification of the unauthorized transaction from the bank. If the customer fails to complain within three working days but does so between four and seven working days, their liability may be capped at a specific limit, depending on the case.

What should you do if you lose your card?
First, block the card using the bank's official app, website, or helpline. Next, review all recent transactions. Immediately report any transactions you did not authorize as fraudulent. Be sure to keep a record of the complaint number, date, and time provided by the bank. If the card was stolen, file a police complaint as well. In the event of financial fraud, you can immediately call 1930 or file a complaint on the National Cyber ​​Crime Reporting Portal.

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