Dark Patterns in Banking Under Scrutiny as RBI Sets July 2026 Deadline for Removal

The Reserve Bank of India has instructed banks to remove dark patterns from digital platforms by July 2026, aiming to strengthen consumer protection in online banking.

The directive follows findings from a large scale survey indicating that several users encounter manipulative interface designs that influence financial decisions. 

The move forms part of broader regulatory efforts to promote transparency, informed consent and responsible digital business conduct across banking applications and websites.

Survey Highlights Widespread Use of Dark Patterns

A nationwide survey conducted by LocalCircles gathered more than 161,000 responses across 388 districts, revealing extensive use of dark patterns on online banking platforms. 

According to the findings, most banks employ between four and seven such practices on average, affecting user decision making during digital transactions.

Respondents reported recurring issues including hidden fees, misleading prompts and interface designs that make opting out of services difficult.

Common Types of Manipulative Design Practices

The survey identified several frequently encountered dark patterns:

• Basket sneaking: Around 57% of users reported additional charges being added during checkout without clear approval.
• Forced action: About 51% said they were compelled to sign up for unrelated services or share additional personal information.
• Drip pricing: Nearly 64% experienced charges that were disclosed only at later stages of a transaction.
• Nagging: Approximately 46% faced repeated prompts encouraging activation of services even after declining them.

Other concerns included subscription traps, bait-and-switch tactics, interface interference and trick questioning, each affecting a significant share of users.

Consumer Experience and Operational Concerns

Many respondents highlighted challenges in cancelling subscriptions, navigating complex app interfaces and understanding promotional offers. 

Confusing prompts and unclear disclosures were cited as contributing to unintended enrolments in additional services, raising concerns about informed consent within digital banking ecosystems.

RBI’s Regulatory Framework

The RBI’s draft Responsible Business Conduct Amendment Directions, 2026 introduces stricter norms for digital conduct. The framework prohibits bundling of financial products without clear approval and requires banks to obtain explicit customer consent before activating any service or charging related fees.

The regulator’s action follows repeated representations made by LocalCircles, which raised concerns regarding dark patterns with the RBI in September 2025 and again in January 2026.

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Conclusion

The RBI’s directive marks a regulatory push towards improving transparency and user autonomy in digital banking. As banks work towards the July 2026 compliance deadline, the focus is expected to shift towards clearer disclosures, simplified interfaces and consent-driven digital practices aimed at strengthening consumer trust.

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