The Reserve Bank India has decided to cap the customers' liability arising out of fraudulent electronic transactions, and has warned banks that they should plug the loophole leading to misselling of insurance products, failing which they would be penalised. “The RBI is examining whether to issue regulatory directions to reduce the liability of the customer on fraudulent transactions arising out of electronic banking transactions,“ said RBI deputy governor SS Mundra, speaking at an event organised by Banking Codes and Standard Board of India. “Between the two -the institution and the customer -the balance of po wer is skewed. The idea is that the liability for the customer should not go beyond a point,“ he said. At present, BCSBI --a quasi-re . 10,000 beyond which a customer is ` not liable for fraudulent ecommerce transactions, provided the customer has notified the bank about it. Stating that misselling has been rampant on insurance products, he said, “Often higher sales