In July 2017, the Reserve Bank of India capped a customer's liability for unauthorised electronic transactions at what maximum amount, if such transactions are reported within seven working days?

Introduction / Context:
With the growth of digital payments and electronic banking, the Reserve Bank of India has issued detailed guidelines to protect customers from losses caused by unauthorised transactions. These guidelines set limits on how much loss a customer may bear, depending on how quickly the unauthorised transaction is reported and on the type of account. This question focuses on the maximum liability for a customer who reports such a transaction within seven working days, as per the 2017 RBI framework for limited liability of customers in unauthorised electronic banking transactions.

Given Data / Assumptions:

• The RBI circular was issued in July 2017 regarding unauthorised electronic banking transactions.
• The question concerns the maximum liability for customers if they report within seven working days.
• Amounts listed are Rs 50,000, Rs 25,000, Rs 10,000, and Rs 20,000.
• Basic familiarity with RBI customer protection guidelines is assumed.

Concept / Approach:
The RBI framework distinguishes between different cases, such as contributory fraud, system negligence, or third party breach. For unauthorised transactions where the fault is not with the customer and the customer reports promptly, liability can be zero. However, for certain categories of accounts and specific situations where some liability applies but the complaint is made within seven working days, RBI prescribed a cap. For savings bank accounts and similar categories, this cap is Rs 10,000. Many exam questions simplify the scenario and ask for this commonly quoted figure, making Rs 10,000 the correct answer here.

Step-by-Step Solution:

Verification / Alternative check:
A quick way to verify is to recall study notes or exam preparation material that often summarise the RBI guidelines by stating: for savings accounts, when reported quickly, the customer's liability is limited to Rs 10,000. Many practice questions repeat this figure, reinforcing it in memory. Cross checking with the idea that higher caps are assigned to other types of accounts, such as current accounts, further supports that Rs 10,000 is the most appropriate general cap mentioned in this context.

Why Other Options Are Wrong:

• Rs 50,000: This limit is associated with other categories or different situations, not the standard cap for typical savings account customers reporting within seven days.
• Rs 25,000: Also used in certain specific contexts, but not the widely quoted figure in exam oriented discussions for early reporting by ordinary customers.
• Rs 20,000: Not the standard figure highlighted in RBI's principal examples for such cases.

Common Pitfalls:
Students may confuse the exact caps for different account categories because multiple figures are mentioned in the guidelines. Another common error is to assume that the highest number in the options is always correct, which is often not the case in questions about regulatory thresholds. To avoid this, candidates should memorise a simple mapping: Rs 10,000 is the common exam tested cap for savings account customers reporting within seven working days, while other amounts apply to corporate or higher value accounts.

Final Answer:
According to the RBI framework, the maximum liability for a typical customer reporting unauthorised electronic transactions within seven working days is capped at Rs 10,000.