Banks’ outsourcing business will now have to follow a comprehensive set of rules. The Reserve Bank has notified the guidelines on outsourcing of services by banks, reports CNBC-TV18.

The RBI says that banks have been extensively outsourcing various activities and are exposed to risks. While the boards of the banks will be responsible for diligence in selecting a service provider, the RBI will have the powers to inspect the records of a service provider.

The new rules state that the service provider should maintain customer confidentiality even after termination of the contract with a bank. Besides, the bank or its agents should not use any threats while recovering dues from customers.