Post on 13-Apr-2015
EXECUTIVE SUMMARY
The aim of this project is to introduce the reader to the topic of “THE
BANKING OMBUDSMAN”. The project also deals with the policy adopted by the
RBI and the some cases.The ability of the banking industry to achieve the socio-
economic objectives and in the process bringing more and more customers into
its fold will ultimately depend on the satisfaction of the customers. Banks have a
strong belief that a satisfied customer is the foremost factor in developing our
business.
This project is focused in understanding the essentiality of the Banking
Ombudsman in regards to the public interest and the interest of the banking
policies to enable resolution of complaints related to deficiency in banking
services. Sensing the need for easy, expeditious and inexpensive mechanism for
redressal of unresolved grievances of customers, the RBI initially formulated the
Scheme of Ombudsman, 1995, which became operational in June 1995,
providing an institutional and legal framework to bank customers to resolve all
their complaint The scheme is applicable to all scheduled commercial banks
having business in India and scheduled primary co-operative banks except
Regional Rural Banks.
Banking Ombudsman at important centres was set up to cover the entire
country. The Banking Ombudsman offers customers the opportunity to resolve
disputes with their banks without needing to resort to the Courts.
1
PREFACE
OBJECTIVES
To present Banking Ombudsman Scheme & how it does works.
To present the services of the Banking Ombudsman offered to the
customer.
To show how the Banking Ombudsman deals with customer complaints.
To explain the duties, functions & powers of the Ombudsman.
METHODLOGY
The methodology includes the information of the features of the Ombudsman in
the form of primary data that had been received from the Branch Managers of the
banks. It also includes the information’s from the related books & the related
websites.
2
CHAPTER- 01
INTRODUCTION TO BANKING
INTRODUCTION
The basic services a bank provides are checking accounts, which can be
used like money to make payments and purchase goods and services; savings
accounts and time deposits that can be used to save money for future use; loans
that consumers and businesses can use to purchase goods and services; and
basic cash management services such as check cashing and foreign currency
exchange. Four types of banks specialize in offering these basic banking
services: commercial banks, savings and loan associations, savings banks, and
credit unions.
A broader definition of a bank is any financial institution that receives,
collects, transfers, pays, exchanges, lends, invests, or safeguards money for its
customers. This broader definition includes many other financial institutions that
are not usually thought of as banks but which nevertheless provide one or more
of these broadly defined banking services. These institutions include finance
companies, investment companies, investment banks, insurance companies,
pension funds, security brokers and dealers, mortgage companies, and real
estate investment trusts.
Banking services are extremely important in a free market economy such
as that found in Canada and the United States. Banking services serve two
primary purposes. First, by supplying customers with the basic mediums-of-
exchange (cash, checking accounts, and credit cards), banks play a key role in
the way goods and services are purchased. Without these familiar methods of
3
payment, goods could only be exchanged by barter (trading one good for
another), which is extremely time-consuming and inefficient. Second, by
accepting money deposits from savers and then lending the money to borrowers,
banks encourage the flow of money to productive use and investments. This in
turn allows the economy to grow. Without this flow, savings would sit idle in
someone’s safe or pocket, money would not be available to borrow, people
would not be able to purchase cars or houses, and businesses would not be able
to build the new factories the economy needs to produce more goods and grow.
Enabling the flow of money from savers to investors is called financial
intermediation, and it is extremely important to a free market economy.
Banking institutions include commercial banks, savings and loan
associations (SLAs), savings banks, and credit unions. The major differences
between these types of banks involve how they are owned and how they manage
their assets and liabilities. Assets of banks are typically cash, loans, securities
(bonds, but not stocks), and property in which the bank has invested. Liabilities
are primarily the deposits received from the bank’s customers. They are known
as liabilities because they are still owned by, and can be withdrawn by, the
depositors of the financial institution.
TYPES OF BANKS
There are various types of banks which operate in our country to meet the
financial requirements of different categories of people engaged in agriculture,
business, profession, etc. On the basis of functions, the banking institutions in
India may be divided into the following types:
4
1.
Central Banks
A bank which is entrusted with the functions of guiding and regulating the
banking system of a country is known as its Central bank. Such a bank does not
deal with the general public. It acts essentially as Government’s banker; maintain
5
TYPES OF BANK
CENTRAL
BANKS
DEVELOPMENT
BANKS
SPECIALIZED
BANKS
CO-OPERATIVE BANKS
CO-OPERATIVE BANKS
COMMERCIAL
BANK
Public Sector Bank
Private sector bank
Foreign bank
Public Sector Bank
Private sector bank
Foreign bank
Primary Credit Societies
Central Co-operative Banks
State Co-operative Banks
Primary Credit Societies
Central Co-operative Banks
State Co-operative Banks
deposit accounts of all other banks and advances money to other banks, when
needed.
The Central Bank provides guidance to other banks whenever they face
any problem. It is therefore known as the banker’s bank. It advises the
Government on monetary and credit policies and decides on the interest rates for
bank deposits and bank loans. Another important function of the Central Bank is
the issuance of currency notes, regulating their circulation in the country by
different methods. No other bank than the Central Bank can issue currency.
2.
Commercial Banks
Commercial Banks are banking institutions that accept deposits and grant short-
term loans and advances to their customers. In addition to giving short-term
loans, commercial banks also give medium-term and long-term loan to business
enterprises. Commercial banks are of three types:
Public Sector Banks
These are banks where majority stake is held by the Government of India or
Reserve Bank of India. Examples of public sector banks are: State Bank of India,
Corporation Bank, Bank of Baroda and Dena Bank, etc
Private Sectors Banks
In case of private sector banks majority of share capital of the bank is held by
private individuals. These banks are registered as companies with limited liability.
For example: The Jammu and Kashmir Bank Ltd., Bank of Rajasthan Ltd.,
Development Credit Bank Ltd, Lord Krishna Bank Ltd., Bharat Overseas Bank
Ltd., Global Trust Bank, Vysya Bank, etc.
6
Foreign Banks
These banks are registered and have their headquarters in a foreign country but
operate their branches in our country. Some of the foreign banks operating in our
country are Hong Kong and Shanghai Banking Corporation (HSBC), Citibank,
American Express Bank, Standard & Chartered Bank, Grindlay’s Bank, etc. The
number of foreign banks operating in our country has increased since the
financial sector reforms of 1991.
3.
Development Banks
Business often requires medium and long-term capital for purchase of machinery
and equipment, for using latest technology, or for expansion and modernization.
Such financial assistance is provided by Development Banks. They also
undertake other development measures like Public Sector Banks comprise 19
nationalized banks and State Bank of India and its 7 associate banks. Industrial
Finance Corporation of India (IFCI) and State Financial Corporation’s (SFCs) are
examples of development banks in India.
4.
Co-Operative Banks
People who come together to jointly serve their common interest often form a co-
operative society under the Co-operative Societies Act. When a co-operative
society engages itself in banking business it is called a Co-operative Bank. The
society has to obtain a license from the Reserve Bank of India before starting
banking business. Any co-operative bank as a society is to function under the
overall supervision of the Registrar, Co-operative Societies of the State. As
regards banking business, the society must follow the guidelines set and issued
by the Reserve Bank of India. There are three types of co-operative banks
operating in our country:
7
Primary Credit Societies
These are formed at the village or town level with borrower and non-borrower
members residing in one locality. The operations of each society are restricted to
a small area so that the members know each other and are able to watch over
the activities of all members to prevent frauds.
Central Co-operative Banks
These banks operate at the district level having some of the primary credit
societies belonging to the same district as their members. These banks provide
loans to their members (i.e., primary credit societies) and function as a link
between the primary credit societies and state co-operative banks.
State Co-operative Banks
These are the apex (highest level) co-operative banks in all the states of the
country. They mobilize funds and help in its proper channelization among various
sectors. The money reaches the individual borrowers from the state co-operative
banks through the central co-operative banks and the primary credit societies.
5.
Specialized Banks
There are some banks, which cater to the requirements and provide overall
support for setting up business in specific areas of activity. EXIM Bank, SIDBI
and NABARD are examples of such banks. They engage themselves in some
specific area or activity and thus, are called specialized banks.
Export Import Bank of India (EXIM Bank)
8
If you want to set up a business for exporting products abroad or importing
products from foreign countries for sale in our country, EXIM bank can provide
you the required support and assistance. The bank grants loans to exporters and
importers and also provides information about the international market.
Small Industries Development Bank of India (SIDBI)
If you want to establish a small-scale business unit or industry, loan on easy
terms can be available through SIDBI. It also finances modernization of small-
scale industrial units, use of new technology and market activities. The aim and
focus of SIDBI is to promote, finance and develop small-scale industries.
National Bank for Agricultural and Rural Development
(NABARD)
It is a central institution for financing agricultural and rural sectors. If a person is
engaged in agriculture or other activities like handloom weaving, fishing, etc.
NABARD can provide credit, both short-term and long-term, through regional
rural banks. It provides financial assistance, especially, to co-operative credit, in
the field of agriculture, small scale industries, cottages and village industries in
rural areas.
9
RIGHTS OF CONSUMERS
Right to Safety
The right to be protected against the marketing of goods and services which are
hazardous to life and property Consumer right to safety applies to all possible
consumption patterns and to all goods and services. In the context of the new
10
market economy and rapid technological advances affecting the market, the right
to safety has become a pre-requisite quality in all products and services. For e.g.
some Indian products carry the ISI mark, which is a NB symbol of satisfactory
quality of a product? Similarly, the FPO and AGMARK symbolize standard quality
of food products.
Right to Information
Right to information means the right to be given the facts needed to make an
informed choice or decision about factors like quality, quantity, potency, purity
standards and price of product or service. The right to information now goes
beyond avoiding deception and protection against misleading advertising,
improper labeling and other practices. For e.g. when you buy a product or utilize
a service, you should be informed about;
a) How to consume a product.
b) The adverse health effects of its consumption.
c) Whether the ingredients used are environment- friendly or not etc.
Right to Redress
The right to seek redressal against unfair trade practices or restrictive trade
practices or unscrupulous exploitation of consumers. It is to protect consumer
interests that consumers have been given the right to obtain redress. In India, we
have a redress machinery called Consumer Courts constituted under the
Consumer Protection Act (1986), functioning at national state and district levels.
But it has not been made complete use of under due to lack of awareness of
basic consumer rights among consumers themselves. While in the developed
world, right to redress is perhaps the most commonly exercised consumer right,
11
in developing countries, consumers are still wary of getting involved in legal
redress system. There are consumer courts in India where any consumer can
lodge a case if s/he thinks he or she has been cheated.
Right to Consumer Education
Consumer education empowers consumers to exercise their consumer rights. It
means the right to acquire the knowledge and skill to be informed consumer
throughout life. The right to consumer education incorporates the right to the
knowledge and skills needed for linking action and influences factors which affect
consumer decisions. It is the single most powerful tool that can take consumers
from their present disadvantageous position to one of strength in the
marketplace. Consumer education is dynamic, participatory and is mostly
acquired by hands-on and practical experience.
Right to Basic Needs
This right is the right to basic goods and services which guarantee dignified
living. It includes adequate food, clothing, health care, drinking water and
sanitation, shelter, education, energy and transportation. Access to food, water
and shelter are the basis of any consumer's life. Without these fundamental
amenities, life cannot exist. The right to basic needs means that availability of
articles which are the basic need of every consumer must be ensured.
Right to be heard
This means the right to be represented so that consumers’ interests receive full
and sympathetic consideration in the formulation and execution of economic
policy. This right is being broadened to include the right to be heard and
represented in the development of products and services before they are
produced or set up; it also implies a representation, not only in government
policies, but also in those of other economic powers.
12
POLICY FOR THE GRIEVANCES REDRESSAL OF THE
CUSTOMER COMPLAINTS
In the present scenario of competitive banking, excellence in customer
service is the most important tool for sustained business growth. Customer
complaints are part of the business life of any corporate entity. This is more so
for banks because banks are service organizations. As a service organization,
customer service and customer satisfaction should be the prime concern of any
bank. The bank believes that providing prompt and efficient service is essential
not only to attract new customers, but also to retain existing ones.
This policy document aims at minimizing instances of customer
complaints and grievances through proper service delivery and review
mechanism and to ensure prompt redressal of customer complaints and
grievances. The review mechanism should help in identifying shortcomings in
product features and service delivery. Customer dissatisfaction would spoil
bank’s name and image. The Bank’s policy on grievance redressal follows the
under noted principles:
Customers be treated fairly at all times
Complaints raised by customers are dealt with courtesy and on time
Customers are fully informed of avenues to escalate their
Complaints/grievances within the organization and their rights to alternative
remedy, if they are not fully satisfied with the response of the bank to their
complaints
13
Bank will treat all complaints efficiently and fairly as they can damage the
bank’s reputation and business if handled otherwise
The Bank employees must work in good faith and without prejudice to
the interests of the customer.
In order to make bank’s redressal mechanism more meaningful and effective, a
structured system needs to be built up towards such end. Such system would
ensure that the redressal sought is just and fair and is within the given frame-
work of rules and regulation. The policy document would be made available at all
branches. All employees of the Bank should be made aware about the Complaint
handling process
The customer complaint arises due to:
The attitudinal aspects in dealing with customers.
Inadequacy of the functions/arrangements made available to the
customers or gaps in standards of services expected and actual
services rendered.
The customer is having full right to register his complaint if he is not
satisfied with the services provided by the bank. He can give his
complaint in writing, orally or over telephone. If customer’s complaint
is not resolved within given time or if he is not satisfied with the
solution provided by the bank, he can approach Banking
Ombudsman with his complaint or other legal avenues available for
grievance redressal.
14
CHAPTER – 2
INTRODUCTIONS TO BANKING OMBUDSMAN
Banking Ombudsman is a quasi judicial authority functioning under India’s
Banking Ombudsman Scheme 2006, and the authority was created pursuant to
the a decision by the Government of India to enable resolution of complaints of
customers of banks relating to certain services rendered by the banks. The
Banking Ombudsman Scheme was first introduced in India in 1995, and was
revised in 2002 and 20061. In the wake of the failure in the efficient services of
the banks, the RBI brought a scheme for the prompt, efficient and courteous
services and also to protect the rights of the customers.
An ombudsman is a person who has been appointed to look into
complaints about an organization. Using an ombudsman is a way of trying to
resolve a complaint without going to court. Banking Ombudsman is a quasi
judicial authority functioning under India’s Banking Ombudsman Scheme, and
the authority was created pursuant to the a decision by the Government of India
to enable resolution of complaints of customers of banks relating to certain
services rendered by the banks.
The Banking Ombudsman is an official authority to investigate the
complaint from the customers and address the complaint and thereby bring the
solution among the aggrieved parties. So the Banking Ombudsman plays the role
of a mediator and serves the purpose of reconciliation. The Banking Ombudsman
has been defined under clause 4 of the Banking Ombudsman Scheme, 20062.
Clause 4 lays down that::
15
APPOINTMENT & TENURE
(1) The Reserve Bank may appoint one or more of its officers in the rank of Chief
General Manager or General Manager to be known as Banking Ombudsmen to
carry out the functions entrusted to them by or under the Scheme.
(2) The appointment of Banking Ombudsman under the above Clause may be
made for a period not exceeding three years at a time
CHARACTERISTICS OF THE BANKING OMBUDSMAN.
1. The Banking Ombudsman is a quasi judicial authority. It has power to summon
both the parties - bank and its customer, to facilitate resolution of complaint
through mediation.
2. All Scheduled Commercial Banks, Regional Rural Banks and Scheduled
Primary
Co-operative Banks are covered under the Scheme.
3.The Banking Ombudsman has power to consider complaints from Non-
Resident Indians having accounts in India in relation to their remittances from
abroad, deposits and other bank-related matters.
4. The Banking Ombudsman does not charge any fee for resolving customers’
complaints.
5. No complaint can be made before a Banking Ombudsman on the same subject
matter for which any proceedings before any court, tribunal or arbitrator or any
other forum is pending or a decree or award or a final order, has already been
passed by any such competent court, tribunal, arbitrator or forum.
16
TYPES OF OMBUDSMAN
Banking Ombudsman
The Reserve Bank of India (RBI) first introduced the Banking Ombudsman
Scheme In1995, which has been revised in 2002 and 2005. The latest revised
Scheme has come into force from 1stJan 2006.
S.E.B.I. Ombudsman
17
TYPES OF OMBUDSMAN
Banking Ombudsman S.E.B.I. Ombudsman
Electricity Ombudsman Telecom Ombudsman
Income Tax Ombudsman
Insurance Ombudsman
the Electricity Act, 2003, issues
guidelines for establishment of
forum and Ombudsman for
redressal of grievances of
Electricity consumers. The Delhi
Regulatory Commission (DERC)
vide its Notification dated
11thMarch, 2006 has issued
DERC (Guidelines for
establishment of Forum of
redressal of grievance of the
consumer and Ombudsman)
Regulations, 2003. It may be
noted that the Ombudsman is the
APPELLATE Authority under
the Electricity Act 2003, and the
DERC Regulations, 2003 and
therefore an electricity consumer
has to first approach the
Consumer Grievance Redressal
Forum established under the
DERC Regulations, 2003.
Telecom Ombudsman
The Telecom Regulatory
Authority of India Act, 1997,
empowers the Telecom
Regulatory Authority of India
Act 1997, empowers the Telecom
Regulatory Authority of India
(TRAI) to make the
recommendations on laying
down the standards of quality of
services to be provided by the
services providers and conduct
the interest of the periodical
surveys of Telecom services so as
to protect the interest of the
consumers. The telecom
operators frequently threaten to
disconnects the phones and with
draw the numbers given t o
subscribers if the deadline for
payment is missed by a day or
there is miscalculation of the
tiniest amount. The TRAI is,
however, neither empowered to
look into the grievances of
individual customers nor take
action against the operators who
do not meet quality of standards
As there is no specialized body to
redress the grievance of telecom
customers, they have to approach
consumer forum setup under
THE Consumer Protection Act,
1986, or civil courts for
Resolutions adjudication of
disputes.
Income Tax Ombudsman
The government is considering
creating an office of Income Tax
Ombudsman to protect individual
taxpayer’s right. The
Ombudsman will identify issues
that increase the compliance
burden or create problems for
taxpayers and bring those issues
to the attention of the ministry of
Finance. The Ombudsman will
make appropriate legislative
proposal where necessary and
send periodical reports to the
Department of Revenue,
suggesting appropriate action. It
is proposed to initially setup
offices of Ombudsman at Delhi,
Mumbai, Kolkata and Chennai.
Insurance Ombudsman
The Government of India,
Minister of Finance, Department
of Economics Affairs, Insurance
Division under section 114 (1) of
Insurance Act, 1938, has framed
the “Redressal of Public
Grievance Rules, 1998”, for
appointment of Insurance
Ombudsman, which comes into
force with effect from
11thNovember 1998. The
Insurance Ombudsman has
started functioning from 1999, to
provide for efficient, cost
effective and impartial settlement
of claims and grievance of any
person against a Life r General
Insurance in Public and private
sector. The meaning of
expression ‘any other person’ is
wider than ‘consumer’ and
therefore, even third party having
grievance with respect to an
Insurance contract can approach
the Ombudsman.
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Top of FormBottom of Form
The Securities Exchange Board of India (SEBI) under section 30 read with sub-
section (1) of section 11 of the SEBI Act, 1992, has framed the SEBI
(Ombudsman) Regulations, 2003, which were notified on 21stAugust 2003. The
Regulations provided for the establishment of the office of Ombudsman to
redress the Grievance of investors in securities and connected matters. The
listed companies and registered stock intermediaries have to disclose the name
address and other particulars of ombudsman in their for the benefit of the
investors.
Electricity Ombudsman
The Electricity Regulatory Commission, under section 181 read with sub-section
(5) of section 42 of the Electricity Act, 2003, issues guidelines for establishment
of forum and Ombudsman for redressal of grievances of Electricity consumers.
The Delhi Regulatory Commission (DERC) vide its Notification dated 11thMarch,
2006 has issued DERC (Guidelines for establishment of Forum of redressal of
grievance of the consumer and Ombudsman) Regulations, 2003. It may be noted
that the Ombudsman is the APPELLATE Authority under the Electricity Act 2003,
and the DERC Regulations, 2003 and therefore an electricity consumer has to
first approach the Consumer Grievance Redressal Forum established under the
DERC Regulations, 2003.
Telecom Ombudsman
The Telecom Regulatory Authority of India Act, 1997, empowers the Telecom
Regulatory Authority of India Act 1997, empowers the Telecom Regulatory
Authority of India (TRAI) to make the recommendations on laying down the
standards of quality of services to be provided by the services providers and
18
conduct the interest of the periodical surveys of Telecom services so as to
protect the interest of the consumers. The telecom operators frequently threaten
to disconnects the phones and with draw the numbers given t o subscribers if the
deadline for payment is missed by a day or there is miscalculation of the tiniest
amount. The TRAI is, however, neither empowered to look into the grievances of
individual customers nor take action against the operators who do not meet
quality of standards As there is no specialized body to redress the grievance of
telecom customers, they have to approach consumer forum setup under THE
Consumer Protection Act, 1986, or civil courts for Resolutions adjudication of
disputes.
Income Tax Ombudsman
The government is considering creating an office of Income Tax Ombudsman to
protect individual taxpayer’s right. The Ombudsman will identify issues that
increase the compliance burden or create problems for taxpayers and bring
those issues to the attention of the ministry of Finance. The Ombudsman will
make appropriate legislative proposal where necessary and send periodical
reports to the Department of Revenue, suggesting appropriate action. It is
proposed to initially setup offices of Ombudsman at Delhi, Mumbai, Kolkata and
Chennai.
Insurance Ombudsman
The Government of India, Minister of Finance, Department of Economics Affairs,
Insurance Division under section 114 (1) of Insurance Act, 1938, has framed the
19
“Redressal of Public Grievance Rules, 1998”, for appointment of Insurance
Ombudsman, which comes into force with effect from 11thNovember 1998. The
Insurance Ombudsman has started functioning from 1999, to provide for efficient,
cost effective and impartial settlement of claims and grievance of any person
against a Life r General Insurance in Public and private sector. The meaning of
expression ‘any other person’ is wider than ‘consumer’ and therefore, even third
party having grievance with respect to an Insurance contract can approach the
Ombudsman.
DUTIES & FUNCTIONS OF OMBUDSMAN
The Ombudsman shall enquire into and investigate in accordance
with the
provisions of the Act, and take action or steps as may be prescribed Act
and concerning-
Practices and actions by persons, enterprises and other private
Institutions where complaints allege that violations of fundamental
rights and freedoms have taken place.
All instance or matters of alleges or suspected corruption and the
misappropriation of public moneys or other public property by
Officials.
Without derogating from the provisions, any request or complaint in
respect of instances or matters referred to in that provisions, may include
any instance or matter in respect of which the Ombudsman has reason
to suspect-
20
That the provisions of any law or under the authority of the State or
by
any person in its employment, or that any practice is so followed, in a
manner which is not in the public interest
That the powers, duties or functions which vest in the State or,
body or
institution, or any person in its employment are exercised or perform in
irregular manner
That moneys forming part of the funds of the State or body or
institution,
or received or held by or on behalf of the State or body or institution
being or have been dealt with an irregular manner
Any person wishing to lay any instance or matter referred to in
provisions
before the Ombudsman shall do so in such manner as the Ombudsman
may determine or allow
The Ombudsman shall not be required to investigate any instance
or
matter referred to in the provisions which has been laid before him or her
is under the provisions when the grounds on account of which the inquiry
is desired in the opinion
The provisions shall not apply in respect of any decision taken in or in
connect with any civil or criminal case by a court of law.
GROUNDS OF CUSTOMERS COMPLAINTS CONSIDERED
BY BANKING OMBUDSMAN
21
The Banking Ombudsman can receive and consider any complaint relating to the
following deficiency in banking services (including internet banking):
non-payment or inordinate delay in the payment or collection of cheques,
drafts, bills etc.;
non-acceptance, without sufficient cause, of small denomination notes
tendered for any purpose, and for charging of commission in respect
there of;
non-acceptance, without sufficient cause, of coins tendered and for
charging of commission in respect there of;
non-payment or delay payment of inward remittances
failure to issue or delay in issue of drafts, pay orders or bankers’ cheques
non-adherence to prescribed working hours
failure to provide or delay in providing a banking facility (other than loans
and advances) promised in writing by a bank or its direct selling agents;
complaints from Non-Resident Indians having accounts in India in relation
to their remittances from abroad, deposits and other bank-related
matters;
levying of charges without adequate prior notice to the customer;
22
non-adherence by the bank or its subsidiaries to the instructions of
Reserve
Bank on ATM/Debit card operations or credit card operations;
refusal to accept or delay in accepting payment towards taxes, as required
by Reserve Bank/Government;
refusal to issue or delay in issuing, or failure to service or delay in servicing
or redemption of Government securities;
forced closure of deposit accounts without due notice or without sufficient
reason;
refusal to close or delay in closing the accounts;
non-observance of Reserve Bank guidelines on engagement of recovery
agents by banks; and
non-observance of Reserve Bank Directives on interest rates;
delays in sanction, disbursement or non-observance of prescribed time
schedule for disposal of loan applications;
non-acceptance of application for loans without furnishing valid reasons to
the applicant;
GROUNDS OF CUSTOMERS COMPLAINTS NOT
CONSIDERED BY BANKING OMBUDSMAN
Ones complaint will not be considered if
23
One has not approached his bank for redressal of his grievance first.
One has not made the complaint within one year from the date one has
received the reply of the bank or if no reply is received if it is more than
one year and one month from the date of representation to the bank
subject matter of the complaint is pending for disposal / has already
been dealt with at any other forum like court of law, consumer court etc.
The Frivolous or vexation.
The institution complained against is not covered under the scheme.
The subject matter of the complaint is not within the ambit of the Banking
Ombudsman
If the complaint is for the same subject matter that was settled through the
Office of the Banking Ombudsman in any previous proceedings.
PROCEDURE FOR FILING COMPLAINT
Any person who has a grievance against a bank on any one or more of
the
grounds mentioned above, may, himself or through his authorized
representative (other than), make a complaint to the Banking Ombudsman
within whose jurisdiction the branch or an advocate Office of the bank
complained against is located.
Complaints arising out of the operations of credit cards, shall be filed
before the Banking Ombudsman within whose territorial jurisdiction the billing
address of the card holder is located and not the place where the bank
concerned or the credit card processing unit is located.
24
The complaint shall be made in writing duly signed by the complainant or
his authorized representative and shall as far as possible be in the form and
shall contain such particulars as specified in the Scheme
The complainant shall file along with the complaint, copies of the documents,
if any, which he proposes to rely upon and also a declaration that the
complaint is maintainable as per clause 9(3) of the Scheme
A complaint can also be made through electronic means.
The complainant shall before making a complaint to the Banking
Ombudsman, make a written representation to the bank
The complaint can be filed if the bank has rejected the complaint or the
complainant had not received any reply within a period of one month after
the bank received his representation or if the complainant is not satisfied
with the reply given to him by the bank
The complaint to the Banking Ombudsman is to be made not later than one
year after the complainant has received the reply of the bank to his
representation or, where no reply is received, not later than one year and
one month after the date of the representation to the bank.
The complaint should not be in respect of the same subject matter which
was settled or dealt with on merits by the Banking Ombudsman in any
previous proceedings whether or not received from the same complainant or
along with one or more complainants or one or more of the parties
concerned with the subject matter.
25
The complaint should not pertain to the same subject matter, for which any
proceedings before any court, tribunal or arbitrator or any other forum is
pending or a decree or award or order has been passed by any such court,
tribunal, arbitrator or forum.
.
The complaint should not be frivolous or vexatious in nature.
The complaint should be made before the expiry of the period of limitation
prescribed under the Indian Limitation Act, 1963 for such claims
Address and Area of Operation of Banking Ombudsman
Sl.
No.
Centre Contact details of the Office of
Banking Ombudsman
Area of Operation
1. Ahmedabad Shri. K . Chandrachoodan
C/o Reserve Bank of India
La Gajjar Chambers,
Ashram Road,
Ahmedabad-380 009
Tel.No.079- 26582357,
079-26586718/2657 5807
Fax No.079-26583325
Click here to send email
Gujarat, Union
Territories of Dadra and
Nagar Haveli, Daman
and Diu
2. Bangalore Shri. K.R.Ananda
C/o Reserve Bank of India
10/3/8, Nrupathunga Road
Karnataka
26
Bangalore-560 001
Tel.No.080-22210771, 080-
22275629
Fax No.080-22244047
Click here to send email
3. Bhopal Shri T. Karunakaran
C/o Reserve Bank of India
Hoshangabad Road,
Post Box No.32,
Bhopal-462 011
Tel.No.0755-2573772, 0755-
2573776
Fax No.0755-2573779
Click here to send email
Madhya Pradesh and
Chattisgarh
4. Bhubaneswar Shri K C Mahapatra
C/o Reserve Bank of India
Pt. Jawaharlal Nehru Marg
Bhubaneswar-751 001
Tel.No.0674-2396207, 0674-
2396008
Fax No.0674-2393906
Click here to send email
Orissa
5. Chandigarh Shri Lalit Srivastava
C/o Reserve Bank of India
4th Floor, Sector 17, Central
Vista
Chandigarh – 160 017
Himachal Pradesh,
Punjab, Union Territory
of Chandigarh and
Panchkula, Yamuna
Nagar and Ambala
27
Tel.No.0172-2721011/2721109
Fax No.0172-2721880
Click here to send email
Districts of Haryana
6. Chennai Shri S. Ganesh
C/o Reserve Bank of India,
Fort Glacis,
Chennai 600 001
Tel No. (044) 2539 9170 /
25395963
/ 2539 9159
Fax No.044-25395488
Click here to send email
Tamil Nadu, Union
Territories of
Pudducherry (except
Mahe Region) and
Andaman and Nicobar
Islands
7. Guwahati Shri B.B.Sangma
C/o Reserve Bank of India
Station Road,
Pan Bazar
Guwahati-781 001
Tel.No.0361-2542556, 0361-
2540445
Fax No.0361-2540445
Click here to send email
Assam, Arunachal
Pradesh, Manipur,
Meghalaya, Mizoram,
Nagaland and Tripura
8. Hyderabad Shri M. Sebastian
C/o Reserve Bank of India
6-1-56, Secretariat Road
Saifabad,
Hyderabad-500 004
Tel.No.040-23210013, 040-
Andhra Pradesh
28
23243970
Fax No.040-23210014
Click here to send email
9. Jaipur Shri N.P.Topno
C/o Reserve Bank of India,
4th floor
Rambagh Circle, Tonk Road
Jaipur-302 052
Tel.No.(0141) 2570357/2570392
Fax No.0141-2562220
Click here to send email
Rajasthan
10. Kanpur Smt. Madhavi Sharma
C/o Reserve Bank of India
M.G. Road, Post Box No.82
Kanpur-208 001
Tel.No.0512-2306278/2303004
Fax No.0512-2305938
Click here to send email
Uttar Pradesh (excluding
District of Ghaziabad
and Gautam Budh
Nagar) and Uttaranchal
11. Kolkata Shri M S Soy
C/o Reserve Bank of India
15, Nethaji Subhas Road
Kolkata-700 001
Tel.No.(O)033-2230-4982
Fax No.033-22305899
Click here to send email
West Bengal and Sikkim
12. Mumbai Shri O.P. Aggarwal Maharashtra and Goa
29
C/o Reserve Bank of India
Garment House,
3rd Floor,
Dr. Annie Besant Road,
Worli, Mumbai-400 018
Tel.No.022-
24924607/24960893/2493 3358
Fax No.022-24960912
Click here to send email
13. New Delhi Shri M Rajeshwara Rao
Banking Ombudsman
Reserve Bank of India Building
2nd Floor, 6, Sansad marg
New Delhi - 110001
TelNo.(011) 23730633/
23736270/23736271/23725445/
23710882
Fax No. 011-23725218
Click here to send email
Delhi, Jammu &
Kashmir,
Haryana (except the
districts of Ambala,
Yamuna Nagar and
Panchkula), and the
districts of Ghaziabad
and Gautam Budh
Nagar of Uttar Pradesh
14. Patna Shri A F Naqvi
C/o Reserve Bank of India,
South Gandhi Maidan,
Patna-800 001
Tel.No.0612-2322569/2323734
Fax No.0612-2320407
Click here to send email
Bihar and Jharkhand
15. Thiruvananthapur Shri F R Joseph Kerala, and Union
30
am C/o Reserve Bank of India
Bakery Junction
Thiruvananthapuram-695 033
Tel.No.0471-2326852
/2332723/2323959
Fax No.0471-2321625
Click here to send email
Territory of
Lakshadweep and Union
Territory of Puducherry (
only Mahe Region)
CHAPTER – 03
BANKING OMBUDSMAN SCHEME
INTRODUCTION
The Banking Ombudsman Scheme, 1995 was notified by RBI on June
14, 1995 in terms of the powers conferred on the Bank by Section 35A of the
Banking Regulation Act, 1949 to provide for a system of redressal of grievances
against banks. The Scheme sought to establish a system of expeditious and
inexpensive resolution of customer complaints. The Scheme is in operation since
1995 and has been revised during the years 2002 and 2006. The Scheme is
being executed by Banking Ombudsmen appointed by Reserve Bank at 15
centers covering the entire country. As mandated by the Banking Ombudsman
Scheme, the Banking Ombudsmen submit an Annual Report on the functioning
of their offices every year. Based on such reports, an Annual Report for the
Banking Ombudsman Scheme in a whole is prepared at Reserve Bank of India,
Central Office.
31
As is being the practice, the Annual Report covers the last five-year
period with focus on the current year. Further, as a result of computerization of
the functioning of Banking Ombudsman Offices through the Complaint Tracking
Software, detailed analysis was possible on the information pertaining to year
2006-07. With the decision to merge the Banking Ombudsman Offices with that
of RBI offices, the accounting period for the Banking Ombudsman Offices was
changed from April 1-March 31 to July 1-June 30 to be in congruent with that of
RBI offices. Accordingly, the information analyses for the year 2006-07 pertains
to the period July 1, 2006 to June 30, 2007.
New areas of Complaint.
The bank customers can complain about non-payment or any inordinate
delay in payments or collection of cheques towards bills or remittances by banks,
as also non-acceptance of small denomination notes and coins or charging of
commission for acceptance of small denomination notes and coins by banks.
Provisions of the Scheme. The Banking Ombudsman Scheme 2006 provides a
wide scope and extent to the schemes of 1995 and 2002. Many new changes
have been made in the old scheme. The most essential provisions of the scheme
are as follows:
1. Appointment and tenure. The Section 4 of the scheme provides for the
appointment of one or more of the officers of the Reserve Bank of India in the
rank of Chief General Manager or General Manager to be known as Banking
Ombudsmen to carry out the functions entrusted to them by or under the
Scheme. Their tenure would be not more than a period of five years.
32
2. Location of the office. Generally, the office of the banking ombudsman is located
at the place specified by the Reserve Bank of India. For the expedite disposal of
the complaints, a banking ombudsman may hold office at such places, under his
jurisdiction which he deems fit for the disposal of the complaints3.
3. Powers and Jurisdictions. The scheme lays down the following provisions dealing
with powers and functions of the Banking Ombudsman:
4. Authority of each Banking Ombudsman extends to the territorial limits entailed by
the Reserve Bank of India.
GENERAL PARTICULARS ON THE SCHEME
The word ‘Ombudsman’ in general means a ‘grievance man’, a public
official who is appointed to investigate complaints against the administration. He
is to intervene for the ordinary citizen in his dealings with the complex machinery
of the establishment. In India, any person whose grievance against a bank is not
resolved to his satisfaction by that bank within a period of one month can
approach the Banking Ombudsman if his complaint pertains to any of the matters
specified in the Scheme.
Banking Ombudsmen have been authorized to look into complaints
concerning deficiency in banking service , sanction of loans and advances in so
far as they relate to non-observance of the Reserve Bank directives on interest
rates, delay in sanction or non-observance of prescribed time schedule for
disposal of loan applications or nonobservance of any other directions or
instructions of the Reserve Bank as may be specified for this purpose, from time
to time, and such other matters as may be specified by the Reserve Bank. The
33
Scheme envisages expeditious and satisfactory disposal of customer complaints
in a time bound manner.
The Banking Ombudsman on receipt of any complaint endeavors to
promote a settlement of the complaint by agreement between the complainant
and the bank named in the complaint through conciliation or mediation. For the
purpose of promoting a settlement of the complaint, the Banking Ombudsman
has been allowed to follow such procedures as he may consider appropriate and
he is not bound by any legal rule of evidence. If a complaint is not settled by
agreement within a period of one month from the date of receipt of the complaint
or such further period as the Banking Ombudsman may consider necessary, he
may pass an Award after affording the parties reasonable opportunity to present
their case. He shall be guided by the evidence placed before him by the parties,
the principles of banking law and practice, directions, instructions and guidelines
issued by the Reserve Bank from time to time and such other factors, which in
his opinion are necessary in the interest of justice.
SCOPE OF THE SCHEME
The Banking Ombudsman Scheme, 2002 covered all the Regional Rural
Banks in addition to all Commercial Banks and Scheduled Primary Co-operative
Banks, which were already covered by earlier Banking Ombudsman Scheme,
1995. There is no change in this regard in the Banking Ombudsman Scheme,
2006.
In 2006, the Reserve Bank of India announced the revised Banking
Ombudsman Scheme with enlarged scope that included customer complaints on
certain new areas, such as, credit card complaints, deficiencies in providing the
34
promised services even by banks' sales agents, levying service charges without
prior notice to the customer and non adherence to the fair practices code as
adopted by individual banks.
The important new grounds of complaints added include credit card
issues, failure in providing the promised facilities, non-adherence to fair practices
code, levying of excessive charges without prior notice and issues pertaining to
accepting payment towards taxes and issuing/servicing of Government
securities. The grounds of complaints have been enumerated in Clause 8 of the
Banking Ombudsman Scheme, 2006.
OPERATIONALISATION
Reserve Bank of India operationalised the Banking Ombudsman Scheme by
establishing Banking Ombudsman Offices at 15 centers all over the country. The
names, addresses and area of operation of the Banking Ombudsmen have been
given in to Annexure ‘A’. Reserve Bank frames the guidelines for operationalizing
the Scheme and supervises the running of the Scheme. It also supervises the
running of the Scheme and administrative arrangements, budget and expenditure
of the Banking Ombudsman Offices.
PERFORMANCE OF THE OFFICES OF BANKING
OMBUDSMAN
The performance of the Offices of the Banking Ombudsman was analyzed on the
aspects such as the quantum of complaints handled by them, the timeliness in
35
handling the issues, and appropriateness of the decisions given against the
complaints.
Number of Complaints Received
The number of complaints received by the Banking Ombudsman Offices had
constantly increased in the last five years. There was more than threefold
increase in the number of complaints received in the year 2006-07 from the
previous year after the Banking Ombudsman Scheme, 2006 was notified. The
increasing receipt was also observed in the year 2007-08 with a 24% increase
from the year 2006-07. The average number of complaints received per Banking
Ombudsman Office has also increased from 550 in 2003-04 to 3192 in 2007-08.
36
Disposal of complaints by Banking ombudsman offices
PeriodNo of Offices of
Banking
Ombudsman
Complaints
received
during the year
Average
of
complaints
per office
No.Change
from
Previous
year
2003-04 15 8246 +53 550
37
2004-05 15 10560 +28 704
2005-06 15 31732 +200 2115
2006-07 15 38638 +22 2576
2007-0815 47887 +24 3192
The increase in the number of complaints received during the years 2005-06
and2006-07 can be attributed to new areas such as credit card complaints
included and to facilitation of complaint submission by allowing complaint
submission in any form including by online and by email allowed in the Banking
Ombudsman Scheme, 2006. Per month receipt in the number of complaints
received under the BO Scheme 2006 was more than thrice the number of
complaints received under the Banking Ombudsman Scheme, 2002.
The increase in the number of complaints received under the Banking
Ombudsman Scheme 2006 as compared to the previous scheme clearly
indicates the extent to which the scheme has benefited larger sections of the
banking customers. The comparative effects of the Banking Ombudsman
Schemes 2002 and 2006 in complaint receipt are given as below:
period Scheme No. of
38
running complaints
From To Total
received
From To Total Total Per
month
01.04.2005 31.12.2005 9 month BO Scheme
2002
9723 1080
01.01.200631.06.2007 18 month BO Scheme 60647 3370
Disposal of Complaints
During the year 2007-08, the Banking Ombudsman Offices disposed of 49100
complaints (including from the complaints pending at the beginning of the year
and those received during the year). Of these, 21747 complaints (49%) were
settled to the satisfaction of the complainants, 15914 complaints (36%) could
no be considered under the scheme owing to several reasons like being
outside the purview of the scheme time-barred, without sufficient
cause, frivolous, pending in other for, etc. A such sample analysis of 756
complaints that could not be considered under the
Scheme disclosed that 42% of complaints fell outside the purview of the
scheme and 23% were first resort complaints and could not be taken
up by the Banking Ombudsman. In 11% of the complaints, deficiency of
service could not be established and the remaining 24% complaints could not
be considered for reasons like they were pending in other for or the
complaints required of complaints over the last five years
are furnished in the following table: 39
Disposal of Complaints by banking ombudsman Officer
Particulars 2003-04 2004-05 2005-06 2006-07 2007-08
Total complaints
dealt
With during the
year
9483 12034 33363 44766 54992
Complaints
setteles to
satisfaction of
complainants(a)
3998
(42%)
5440
(45%)
14931
(45%)
21747
(49%)
39365
(53%)
Complaites could
not be
considered under
the scheme(b)
4011
(42%)
4963
(41%)
12304
(37%)
15914
(36%)
19735
(36%)
The number of
complaints
disposed of(a+b)
8009
(84%)
10403
(86%)
27235
(82%)
37661
(84%)
49100
(89%)
Complaints
under process
1474
(16%)
1631
(14%)
6128
(18%)
7105
(16%)
5892
(11%)
Mode of Disposal of Complaints
The Banking Ombudsman disposed of complaints, other than the complaints that
could not be considered, either by mutual settlement or by issuing an Award.
During the period reviewed, the ratio of complaints disposed by settlement to the
complaints disposed by award was around 99:1 clearly indicating the
effectiveness of the Banking Ombudsmen in arriving at mutually agreed
consensus between bankers and complainants. During the period above, only
40
563 awards were issued which formed less than 2% of the total 49,253
complaints disposed of. From the year 2006-07, the number of awards issued
and the percentage of disposal through award issuance have come down despite
huge increase in the complaints received. Details are as given table below. The
fact that the Banking Ombudsmen could dispose of more than 98% of the
complaints by mutual settlement between the complainant and the concerned
banks to their satisfaction indicates that they took appropriate decisions taking
into consideration all the relevant and extant legal and banking instructions and
practice.
Mode of disposal of complaints
(Other than complaints that could not be considered)
Sr.
No
Year No. of
complaints
disposed
of
Disposal by
award
Disposal by
settlement
41
NO. % No. %
1 2003-2004 3998 121 2.21 3877 97.78
2 2004-2005 5440 165 3.03 5275 96.97
3 2005-2006 14931 146 0.98 14785 99.02
4 2006-2007 21747 84 0.39 21662 99.61
5 2007-2008 29365 70 0.24 29295 99.76
Analysis of Complaints:42
Analysis of Complaints dealt with - Category-Wise
The analysis of complaints received at the Banking Ombudsman
offices includes analysis of subject category of complaints and the bank-groups
against which the complaints were made. Computerization of the functioning of
Banking Ombudsman Offices through the Complaint Tracking Software has
enabled detailed analysis in this regard.
The maximum number of complaints dealt with during the last five-year
period pertained to complaints regarding deposit accounts, deficiency in servicing
of loans and advances and delay in collection of cheques/bills, etc, besides the
miscellaneous complaints. The details are given in the following table:
Analysis of complaints dealt with - category-wise
Category 2002-03 2003-04 2004-05 2005-06 2006-07
Deposit
Accounts
2500
(27%)
250(27%)
(26%)
3239
(27%)
6733
(20%)
5803
(15%)
Loans and
Advances
1651 1226 2291 5251 5151
Collection of
cheques/bills
908
(14%)
1226
(13%)
1245
(19%)
3058
(16%)
4058
(11%)
Others 2158
(38%)
4756
(50%)
5259
(44%)
18357
(55%)
23626
(61%)
43
Total 6506 9483 12034 33363 38638
Category 2002-03 2003-04 2004-05 2005-06 2006-07
However, during the year 2006-07, the maximum number of complaints received
pertained to credit cards at 20%. Complaints pertaining to deposit accounts,
loans and advances and remittances occupied the next three places in the
number of complaints received. The details are shown below.
Complaint received in 2006-07 & 2007-08 category wise
44
COST DETAILS OF RUNNING THE SCHEME
45
Sr.No. Nature of complaint Received during
2006-07 2007-08
1. Deposit accounts 5803 5612
2. Remittances 4058 5213
3. Credit cards 7688 10129
4. Loans and advances - General 4442 5297
5. Loans and advances-Housing 709 757
6. Charges without notice 2594 3740
7. Pension 1070 1582
8. Failure on commitments made 1469 6388
9. DSAs and recovery agents 1039 3128
10. Notes and coins 130 141
11. Others 9636 5900
Total 38638 47887
The costs of the Scheme include the revenue expenditure and capital
expenditure incurred in running the Banking Ombudsman offices. The revenue
expenditure includes the establishment items like salary and allowances of the
staff attached to Banking Ombudsman offices and non-establishment items such
as rent, taxes, insurance, law charges, postage and telegram charges, printing
and stationery expenses, publicity expenses, depreciation and other
miscellaneous items. The capital expenditure items include the furniture,
electrical installations, computers/related equipments, telecommunication
equipments and motor vehicle.
period Total cost (Rs.Cr) No.of
complaints dealt
Cost per
complaint (Rs)
2003-04 7.03 9,483 7,413
2004-05 7.60 12,034 6,315
2005-06 10.16 33,363 3,045
2006-07 9.81 38,638 2,538
2007-08 12.50 47,887 2,611
CHAPTER-446
DIFFERENCE BETWEEN BANKING OMBUDSMAN SCHEME
1995, 2002 & 2006
The Ombudsman’s task is to provide citizens with a means of redress for
maladministration. By performing this role, the Ombudsman helps, first, to relieve
the burdens of litigation by promoting friendly settlement and making
recommendations to avoid the need for proceedings in courts; and second, to
promote the effective implementation of citizen's rights. The Ombudsman is
impartial and has a conciliatory approach.
In India, any person whose grievances against a bank are not resolved to
his satisfaction by that bank within a period of two months then he can approach
the Banking Ombudsman for redressal. This is however subject to the complaint
pertaining to any of the matters specified in the Banking Ombudsman Scheme.
Reserve Bank of India (RBI) which assumes the role similar to that of
quasi-legal machinery as it is established by a competent authority to provide for
an additional but optional legal remedy for effective, expeditious and inexpensive
redressal of customer grievances. Towards effective compliance of this optional
legal remedy it introduced the Banking Ombudsmen Scheme in 1995 and got it
further amended in 2002 and in 2006.
The Reserve Bank of India notified the revised Banking Ombudsman
Scheme, 2006 which came into effect from January 1, 2006. The new scheme
widens its scope thereby to include customer complaints on certain areas like
credit card complaints, deficiencies in providing the promised services even by
banks’ sales agents, levying service charges without prior notice to the customer
and non- adherence to the fair practices code as adopted by the individual
banks. It is made applicable to all commercial banks, regional rural banks and
scheduled primary cooperative banks whose principal place of business is in
India.
47
The Revised Scheme with well-equipped staff is wholly funded by the
Reserve Bank of India. This new scheme allows the complainants to file a
complaint in any form, including online and the bank customers are entitled to file
an appeal with the Reserve Bank of India. It provides a forum for bank customers
for redressal of their common complaints against banks. On the basis of the new
Banking Ombudsman Scheme, 2006 the customers are also privileged to
complain about non-payment or any inordinate delay in payments or collection of
cheques towards bills or remittances by banks, as also non acceptance of small
denomination notes and coins or charging of commission for acceptance of small
denomination notes and coins by banks. The Banking Ombudsmen currently
have their offices in 15 centers covering the entire country.
Is the New Banking Ombudsman Scheme 2006 differs from its
previous schemes?
The vision behind the emergence of Banking Institution is to evolve into a strong,
sound and globally competitive financial system, providing integrated services to
customers from all segments, leveraging on technology and human resources,
adopting the best accounting and ethical practices and fulfilling corporate and
social responsibilities towards all stakeholders. As a part of this vision, the RBI
lodged various Ombudsman schemes till today which forms a part of our
discussion.
Yes, the new scheme 2006 differs from its previous schemes. The extent and
scope of the scheme, 2006 is much wider than its earlier schemes of 1995 and
2002. Because the new scheme introduces for the first time;
Includes complaints relating to credit cards, deficiencies in providing the
without prior notice to the customers and non-compliance of promised
services by banks and its marketing agents, levying of service charges
fair practice codes by the banks;
48
Facilitates the submission of complaints through online;
Establishes an appellate authority to facilitate appeals against the awards
rendered by the Banking Ombudsmen instead of filing with the Review
Authority for review of such awards.
The extent and scope of the new Scheme is wider than the earlier Scheme of
2002. The new Scheme also provides for online submission of complaints. The
new Scheme additionally provides for the institution of an 'appellate authority' for
providing scope for appeal against an award passed by the Ombudsman both by
the bank as well as the complainant.
In exercise of the powers conferred by Section 35A of the Banking
Regulation Act, 1949 and in partial modification of its Notification dated
December 26, 2005, Reserve Bank of India hereby amends the Banking
Ombudsman Scheme 2006 to the extent specified in the Annex hereto. The
Reserve Bank hereby directs that all commercial banks, regional rural banks and
scheduled primary co-operative banks shall comply with the Banking
Ombudsman Scheme, 2006 as amended hereby. The amendments in the
Scheme shall come into force from January 1, 2006.
AMENDMENT PASSED BY RBI FOR THE CHANGES IN
BANKING OMBUDSMAN SCHEME, 2006:
Amendment 1:
RBI expands Scope of Banking Ombudsman Scheme; Includes Fair
Banking Practices.
Date: 26 Dec 2005
The Reserve Bank of India today announced the revised Banking
Ombudsman Scheme with enlarged scope to include customer complaints on
certain new areas, such as, credit card complaints, deficiencies in providing the
49
promised services even by banks' sales agents, levying service charges without
prior notice to the customer and non adherence to the fair practices code as
adopted by individual banks. Applicable to all commercial banks, regional rural
banks and scheduled primary cooperative banks having business in India, the
revised scheme will come into effect from January 1, 2006.
In order to increase its effectiveness, the revised Banking Ombudsman
Scheme will be fully staffed and funded by the Reserve Bank instead of the
banks. Under the revised Banking Ombudsman Scheme, the complainants will
be able to file their complaints in any form, including online. The bank customers
would also be able to appeal to the Reserve Bank against the awards given by
the Banking Ombudsman.
The new scheme provides a forum to bank customers to seek redressal of
their most common complaints against banks, including those relating to credit
cards, service charges, promises given by the sales agents of banks, but not
kept by banks, as also, delays in delivery of bank services. The bank customers
would now be able to complain about non-payment or any inordinate delay in
payments or collection of cheques towards bills or remittances by banks, as also
non- acceptance of small denomination notes and coins or charging of
commission for acceptance of small denomination notes and coins by banks.
The Reserve Bank had first introduced the Banking Ombudsman Scheme in
1995 to provide expeditious and inexpensive forum to bank customers for
resolution of their complaints relating to deficiency in banking services. The
Scheme was revised in 2002 mainly to cover Regional Rural Banks and to permit
review of the Banking Ombudsmen’s awards against banks by the Reserve
Bank. The Banking Ombudsmen currently have their offices in 15 centers.
The Reserve Bank is also in an advanced stage of setting up an independent
Banking Codes and Standards Board of India to ensure that comprehensive code
of conduct for fair treatment to customers are formulated by banks and adhered
50
to. The Reserve Bank of India had announced setting up of the Board in its
Annual Policy for 2005-2006 announced by the Governor, Dr Y V Reddy in April
2005.
Amendment 2:
Customers can now appeal against the Banking Ombudsman's Decision.
Date: 24 May 2007
Bank customers can now appeal against the decision of the Banking
Ombudsman where he has rejected the customer's complaint relating to matters
falling within the grounds of complaints specified under the scheme. The Reserve
Bank of India has amended the Banking Ombudsman Scheme, 2006 to enable
the customers to appeal against the Banking Ombudsman's decision. The
amendments are available on the RBI website. Before the scheme was
amended, the bank customers could appeal only against the awards given by the
Banking Ombudsman. The appellate authority for the Banking Ombudsman
Scheme is the Deputy Governor of Reserve Bank of India.
It may be recalled that in the Annual Policy for 2007-2008, the Reserve
Bank had announced that based on customer feedback, it would amend the
Banking Ombudsman Scheme, 2006 to extend the appeal option also to the
decisions of the Banking Ombudsman.
Originally introduced in 1995, the Banking Ombudsman Scheme enables
speedy and cost effective resolution of complaints of bank customers relating to
deficiency in bank services. The Scheme now covers all Scheduled Commercial
Banks, Regional Rural Banks and Scheduled Primary Co-operative Banks. The
customers can also now complain to the Banking Ombudsman against deficiency
in almost any banking services, including credit cards, after exhausting the
channel available with the bank concerned for resolving their complaints. The
Reserve Bank has appointed 15 Banking Ombudsmen who are located mostly in
51
State Capitals under the Scheme. The Banking Ombudsman tries to resolve the
complaint through conciliation or mediation and even passes an award if it is not
resolved through such settlement.
52
CHAPTER - 5
A Brief Profile of the Canara Bank
Widely known for customer centricity, Canara Bank was founded by Shri
Ammembal Subba Rao Pai, a great visionary and philanthropist, in July 1906, at
Mangalore, then a small port in Karnataka. The Bank has gone through the
various phases of its growth trajectory over hundred years of its existence.
Growth of Canara Bank was phenomenal, especially after nationalization in the
year 1969, attaining the status of a national level player in terms of geographical
reach and clientele segments. Eighties was characterized by business
diversification for the Bank. In June 2006, the Bank completed a century of
operation in the Indian banking industry. The eventful journey of the Bank has
been characterized by several memorable milestones. Today, Canara Bank
occupies a premier position in the comity of Indian banks. With an unbroken
record of profits since its inception, Canara Bank has several firsts to its credit.
These include:
Launching of Inter-City ATM Network
Obtaining ISO Certification for a Branch
Articulation of ‘Good Banking’ – Bank’s Citizen Charter
Commissioning of Exclusive Mahila Banking Branch
Launching of Exclusive Subsidiary for IT Consultancy
Issuing credit card for farmers
Providing Agricultural Consultancy Services
Over the years, the Bank has been scaling up its market position to
emerge as a major 'Financial Conglomerate' with as many as nine
53
subsidiaries/sponsored institutions/joint ventures in India and abroad. As at June
2010, the Bank has further expanded its domestic presence, with 3057 branches
spread across all geographical segments. Keeping customer convenience at the
forefront, the Bank provides a wide array of alternative delivery channels that
include over 2000 ATMs- one of the highest among nationalized banks- covering
732 centres, 2681 branches providing Internet and Mobile Banking (IMB)
services and 2091 branches offering 'Anywhere Banking' services. Under
advanced payment and settlement system, all branches of the Bank have been
enabled to offer Real Time Gross Settlement (RTGS) and National Electronic
Funds Transfer (NEFT) facilities.
Not just in commercial banking, the Bank has also carved a distinctive
mark, in various corporate social responsibilities, namely, serving national
priorities, promoting rural development, enhancing rural self-employment through
several training institutes and spearheading financial inclusion objective.
Promoting an inclusive growth strategy, which has been formed as the basic
plank of national policy agenda today, is in fact deeply rooted in the Bank's
founding principles. "A good bank is not only the financial heart of the community,
but also one with an obligation of helping in every possible manner to improve
the economic conditions of the common people".
These insightful words of our founder continue to resonate even today in
serving the society with a purpose. The growth story of Canara Bank in its first
century was due, among others, to the continued patronage of its valued
customers, stakeholders, committed staff and uncanny leadership ability
demonstrated by its leaders at the helm of affairs. We strongly believe that the
next century is going to be equally rewarding and eventful not only in service of
the nation but also in helping the Bank emerge as a "Global Bank with Best
Practices". This justifiable belief is founded on strong fundamentals, customer
centricity, enlightened leadership and a family like work culture.
54
Canara Bank customers can now post complaints on consumer Web sites:
Addressing complaints
“Our customer service cell will be the monitoring wing of the bank,” he said.
According to him, most complaints are regarding ATM cards, delay in sanctioning
housing loans, delay in transfer of accounts and pension-related issues.
There are about three complaints a day now, he pointed out, adding that the
bank will try to solve issues with a 72-hour turnaround time. The centralised
customer service cell currently has three members, in addition to separate cells
in each circle office of the bank.
“The six sites that we have identified are not exhaustive, and the circle should
monitor such other sites for taking further action on matters regarding our bank,”
said Mr Pai, adding, “We are in a services industry, and the attempt is to
convince the customer that we are sensitive to their requirements.”
Interaction with customer
Customer's expectation/requirement/grievances can be better understood
through personal interaction with customers by Bank's staff. Structured customer
meets will give a message to the customers that the bank cares for them and
values their feedback/suggestions for improvement in customer service. Many of
the complaints arise on account of lack of awareness among customers about
bank services and such interactions will help the customers appreciate the
banking services better. The feedback from customers would be a valuable input
for revising our product and services to meet customer requirements.
55
Sensitizing the operating staff on handling complaints
Our staff will be properly trained for handling complaints. During all the Training
Sessions at our Apex Staff Training College and Regional Staff Training Colleges
the importance of handling complaints is explained to all the participants and they
are trained to deal with customer complaints. Nodal Officer for the Bank will
ensure that internal machinery for handling complaints/grievances operates
smoothly and efficiently at all levels and he will be giving feed back on training
needs of staff at various levels to the Human Resources Department.
Canara Banking scheme :
a. We have displayed on our website and in all our Branches a notice
explaining that we are covered by the Banking Ombudsman Scheme,
2006 of the Reserve Bank of India . The copy of the scheme is made
available at all the branches and will be issued to customers at a nominal
charge.
b. Within 30 days of lodging a complaint with us, if customer does not get a
satisfactory response from us and if customer wishes to pursue other
avenues for redressal of grievances, customer may approach Banking
Ombudsman appointed by Reserve Bank of India under Banking
Ombudsman Scheme, 2006. Salient features of the Banking Ombudsman
Scheme, 2006 are displayed in the branch notice boards and the scheme
itself is displayed on our Website www.canarabank.com. If customers face
any difficulty our Staff will explain the procedure in this regard.
Internal Machinery to handle customer complaints/grievances
56
a. If the customer wants to make a complaint, we will inform :
Where to make complaint
How a complaint should be made
When to expect a reply
Whom to approach for redressal
What to do if customers are not happy about the outcome
b. The Bank will inform customers where to find details of procedures for
handling complaints fairly and quickly.
c. If the customer complaint is received in writing, we will endeavour to send
an acknowledgement/a response within a week. If customer complaint in
relayed over phone at our designated telephone helpdesk or customer
service number we shall provide a complaint reference number and keep
customers informed of the progress within a reasonable period of time.
d. After examining the matter, we will send our final response or explain why
we need more time to respond and shall endeavour to do so within 30
days of receipt of complaint and will tell customers to take their complaint
further if they are still not satisfied.
COMPLAINT REDRESSAL MECHANISM IN CANARA BANK
AT BRACH
Resolution of graveness
Branch Manager will be responsible for the resolution of the
complaints/grievances in respect of customer's service by the Branch. He/she
would be responsible for ensuring closure of all complaints received at Branches.
57
It is his/her foremost duty to see that the complaint should be resolved
completely to the customer's satisfaction and if the customer is not satisfied, then
he shall be provided with alternate avenues to escalate * the issue if the same is
not resolved within the stipulated period. If the Branch Manager feels that is not
possible at his/her level to solve the problem he/she may refer the case to
Regional or Circle Office or Head Office for guidance.
Similarly, if Regional Office/Circle Office finds that they are not able to
solve the problem such cases may be referred to the Nodal Officer of the Bank.
Suggestion Box and complaint Book are provided in all the branches. Any written
complaint is instantly and promptly acknowledged.
All branches other than small branches have " May I help you counters ".
Counter staff are provided with training and additional inputs.
If counter staff/Supervisor is unable to resolve a grievance, the branch in-
charge intervenes and tries to resolve the issue.
Customers' Day is observed on 15 th of every month. On this day branch
in-charge will make himself available at the branch between 3 p.m. and 5
p.m. to meet customers without any prior appointment.
Customer Service Committee meetings is held every month at all
Branches, Circle Offices. The sole task of the
Committee is to find out ways and means to render service to the
satisfaction of the Customers. For this purpose
Committee will meet regularly at stipulated intervals to discuss in detail the
strengths and deficiencies of the services presently rendered and take
steps to improve it.
Special Customers' Meet is conducted on special occasions.
Every year, Customer Fortnight is observed to create awareness among
Public as well as staff for achieving the objective of Complaint free branch
network and also highlight our products and services.
58
AT REGIONAL OFFICE/CIRCLE OFFICE
Divisional Manager / Assistant General Manager hold exclusive charge of
Customer Service Section at Regional Office/Circle office.
By and large, complaints are redressed within shortest possible time.
Whenever it is not possible and more cross checking is required, steps are
taken to settle the matter within a reasonable time.
Divisional Managers(O) / Assistant General Manager(O) visit branches
periodically and submit a report on Customer Service, as per the detailed
checklist
Divisional Manager / Assistant General Manager in-charge of Customer
Service Section, Regional office / Circle Office contact the aggrieved
customers as and when necessary, meet him personally with the Branch
Manager, for
ensuring timely redressal of the complaint.
Wherever deficiencies are noticed, accountability is fixed and erring
employees punished.
Still there may be some aggrieved customers who write to Head office.
AT HEAD OFFICE
A full-fledged Customer Service Section is functioning at M&CRM Wing,
Head Office, overseen by General Manager.
An acknowledgement is sent to the customer immediately on receipt of the
complaint.
Thorough analysis of the complaints is done and necessary instructions
are given to CO/RO/ Branches for speedy redressal and followed up till
final redressal letter is sent to the complainant duly explaining the decision
taken on the complaint.
59
On 15 th of every month, Customers' Day is observed between 3 p.m. and
5 p.m. during which our overseeing
Executives are available for meeting the public / Customers without prior
appointment.
Special Customers' Meets are organised for different segments of the
market, viz., Exporters, SSI, NRI, Agriculturists, etc..
Customer Satisfaction Surveys through In-house as well as by External
agencies are conducted to assess the level of customer satisfaction.
Grievance Escalation System
Customers can lodge their complaints directly to Branch-in-charge and it
will be the responsibility of the Branch-in-charge to resolve the complaint
within 7 days from the date of receipt.
The Branch-in-charge will analyse the complaint and if need be he/she will
contact the complainant personally and resolve the complaint.
A complaint redressal letter will be sent to complainant, if the complaint is
resolved at Branch level. The Branch will also send the details of the
grievance received by the at periodical intervals to Regional Office/Circle
Office.
If the Branch-in-charge is not able to resolve the complaint within 7 days,
the complaint will be referred by the Branches to the concerned Regional
Office/Circle along with their comments / replies for further action.
The complaints referred to Regional Office/Circle Office will be analysed
by Customer Service Section and based on the explanation received from
the Branch, RO/CO will send a suitable reply to complainant.
If the reply received from the Branch is not satisfactory and if Regional
Office/Circle Office cannot resolve the complaint within 7 days from the
date of receipt of complaints, the same will be referred to Customer
Service Section, Head Office along with their comments/explanations. The
60
Regional Office/Circle Office will also send the details of the complaints
received directly by them and not settled within seven days to Customer
Service Section, Head Office along with their comments/replies.
Customer Service Section, Head Office will analyse the complaint and the
replies received from Branch and Regional Office/Circle Office. On placing
the matter before appropriate authorities a decision is taken on the
complaint. A complaint redressal letter is sent to the complainant from
Head Office and suitable instruction are passed on to Branch, Regional
Office, Circle Office for taking action in the deficient areas.
COMPLAINTS/ GRIEVANCES
Customer Service Committee of the Board
This sub-committee of the Board would be responsible for formulation of a
Comprehensive Deposit Policy incorporating the issues such as the treatment of
death of a depositor for operations of his account, the product approval process
and the annual survey of depositor satisfaction and the tri-enniel audit of such
services. The Committee would also examine any other issues having a bearing
on the quality of customer service rendered. This Committee would also review
the functioning of Standing Committee on Customer Service. The Customer
Service Committee of the Board is responsible for the rendering of customer
service to the individual, both as a depositor and also as a borrower. The
Committee is, therefore, responsible for examining loan policies and service
issues for the individual as a borrower also.
Standing Committee on Customer Service
The Standing Committee on Customer Service will be chaired by the Managing
Director/ Executive Director of the Bank. Besides two to three senior executives
61
of the bank, the committee would also have two to three eminent non-executives
drawn from the public as members. The committee would have the following
functions.
Evaluate feed-back on quality of customer service received from various
quarters. The committee would also review comments/feed-back on
customer service and implementation of commitments in the Code of
Bank’s Commitments to Customers received from BCSBI.
The Committee would be responsible to ensure that all regulatory
instructions regarding customer service are followed by the bank. Towards
this, the committee would obtain necessary feed-back from zonal/regional
managers/ functional heads.
The committee also would consider unresolved complaints/grievances
referred to it by functional heads responsible for redressal and offer their
advice.
The committee would submit report on its performance to the customer
service committee of the board at quarterly intervals.
TIME FRAME
Complaints received will be seen in right perspective and will be analyzed from
all possible angles. Specific time schedule is set up for handling complaints and
disposing them at all levels including branches/Regional Offices/Circle Offices
and Head Office. The Branch Manager will try to resolve the complaint within
specified time frames decided by the Bank.
62
TIME SCHEDULE FOR REDRESSAL OF COMPLAINTS
Stipulated by MOF Adopted by bank
General Complaints 30 days 21 days
Complaints forwarded
by RBI/MOF
MPs/VVIPs
21 days 15 days
Complaints from PMs
office
15 days 7 days
63
CHPTER – 6
CASE STUDY
COMPENDIUM OF CASE HANDLED BY THE BANKING
OMBUDSMAN OFFICE
SUBJECT: Refusal to Close the Account
Complaint No. 1
Complaint in brief:
‘X’ the complainant, had issued cheque dated 20.10.2004 for
Rs.5,00,000/- (Rupees Five lakhs only) to their supplier and mentioned the
supplier’s account No. on the reverse side of the Cheque. The cheque was
deposited in the drop box of ABC Bank, on 22.10.04 at about 10.30 a.m. The
cheque was taken out of the drop box by a miscreant who opened current
account in the name of the supplier with Y Bank on 24.10.04 (Sunday). As per
the records of Y Bank, the supplier was a proprietary concern owned by one
Mr.Z. The bank contended that the opening of account was supported by proof of
addresses submitted by the customer. Thus the account was duly introduced
with sufficient proof of address.
Y Bank confirmed having observed the KYC norms.
Decision by ombudsman
The person giving introduction should be of some standing and have an
accountwith the bank for at least six months to ensure that the accounts are not
opened on the introduction of new account holders or persons having small and
marginal balances. In the instant case, the introducer’s account was less than 6
monthsold. There is no record to show that efforts were made to verify the
authenticity of the existence of account opened firm.
In the case of Kerala State Co-operative Marketing Federation vs State Bank of
India and others, the Supreme Court of India has spelt out the principles
64
governing the liability of a collecting banker are:
As a general rule the collecting banker shall be exposed to his usual liability
under common law for conversion or for money had and received, as against the
“true owner” of a cheque/draft, in the event the customer from whom he collects
the cheque or draft has no title or a defective title. The banker, however, may
claim protection from such normal liability provided he fulfils strictly the conditions
laid down in Section 131 or Section 131A of the Negotiable Instruments Act,
1881, and one of those conditions is that he must have received the payment in
good faith and without negligence. It is the banker seeking protection who has on
his shoulders the onus of proving that he acted in good faith and without
negligence.
Negligence is a question of fact and what is relevant in determining the
liability ofa collecting banker is not his negligence in opening the account of the
customer but negligence in the collection of the relevant cheque unless, of
course, the opening of the account and depositing of the cheque in question
therein form part and parcel of one scheme as where the account is opened with
the cheque in question or deposited therein so soon after the opening of the
account as to lead to an inference that depositing the cheque and opening the
account were interconnected moves in an integrated plan.
Negligence in opening the account such as failure to fulfil the procedure
for opening an account which is prescribed by the bank itself or opening an
account of an unknown person or non existing persons or with dubious
introduction may lead to a cogent, though not conclusive, proof of negligence
particularly if the cheque in question has been deposited in the account soon
after the opening
thereof.
It may be noted that Y Bank opened the account in the name of the supplier
on 24th October 2004. The cheque for Rs.5,00,000 issued by the complainant
was deposited in the account on 25,10.2004. The value of the cheque was
credited on 27.10.2004. Rs.3,00,000 was drawn in the morning of 29.10.2004
65
and Rs.1,80,000 drawn in the afternoon. The Y Bank was negligent in opening
the account in the name of the complainant allowing the depositor to immediately
draw Rs.4,80,000/- out of Rs.5,00,000/-. The account was introduced by a
person who did not have account with the branch for a minimum period of six
months as per guidelines of RBI.
The address of the account holder in the driving
license was left blank. Y Bank was found to be deficient in opening the current
account without proper introduction and verification, thereby enabling the account
holder to open the account, deposit the cheque and draw major portion of the
cheque proceeds in quick succession.
Complaint No. 2
Complaint in brief:
The complainant having a savings bank account with the subject bank
found thatthere was an unauthorized debit of Rs. 15000 in his account. On
enquiry with thebank, they informed that it purported to the ATM transactions
made by him. The complainant claimed that he had not withdrawn any amount
on that day. The debits were made by the bank after six months without
intimation to the complainant. The complainant requested to restore the
unauthorized debit made
by the bank.
Decision by ombudsman
The Banking Ombudsman perused the documentary evidence for ATM
transactions produced by the bank, which contained the ATM card number and
his account number. As nobody other than the card holder can operate the ATM
and withdraw money, his argument that he was not aware of the ATM
transactions made by him cannot be accepted. The Banking Ombudsman
advised the bank to explain the position to the complainant to his satisfaction
along with the documentary evidence and the complainant was advised that on
the basis of the documentary evidence for ATM transactions provided by the
66
bank, the card holder has undoubtedly made the three ATM cash withdrawals of
Rs,.5000/- each.
Complaint No. 3
Complaint in brief:
The complainant was having a Saving Bank Account. with the opposite party
bank. Being an employee of TCS, his salary and other allowances were being
directly credited to his account with the bank. He alleged that the bank had
issued a cheque-book without his knowledge to someone else and had passed
cheques which were not drawn by him. The total amount so fraudulently
withdrawn from his account amounted to Rs.977,000/-. A police complaint was
also filed.
Decision by ombudsman
The subsequent developments after filing of the police complaint and the
opiniongiven by the GEQD, leads to an irrefutable conclusion that the culprits
had made fraudulent withdrawals by forging the signature of the complainant. In
the circumstances, prima facie forgery had been established. Legally if the
drawer’s cheque is forged or unauthorised, however clever the forgery is, the
banker cannot debit his customer’s account in case he pays the sum unless he
establishes adoption or estoppel. The complainant was out of India during the
material time. The bank could not bring out any evidence/proof that the
complainant was in any way connected with the fraud or his involvement in the
forgery.
67
FORM OF COMPLAINT (TO BE LODGED) WITH THE BANKING
OMBUDSMAN
(TO BE FILLED UP BY THE COMPLAINANT)
To:
The Banking Ombudsman
Place of BO’s office…………………………..
Dear Sir,
Sub: Complaint against …………………….(Name of the bank’s branch) of
…………………………………………………………………………………(Name of
the Bank)
Details of the complaint are as under:
1. Name of the Complainant …………………..
2. Full Address of the Complainant ……………………
……………………
……………………
Pin Code ………………..
Phone No/ Fax No. .……………………
Email …………………….
68
3. Complaint against (Name and full address of the branch/bank)
………………………….
Pin Code …………………….
Phone No. / Fax No. …………………….
4. Particulars of Bank or Credit card Account (If any)
…………………………………………………………………………
5. (a) Date of representation already made by the complainant to the bank
(Please enclose a copy of the representation) ……………………….
(b) Whether any reminder was sent by the complainant? YES/NO
( Please enclose a copy of the reminder )
……………………….
6. Subject matter of the complaint (Please refer to Clause 8 of the Scheme)
…………………………………………………………………………………………
7. Details of the complaint:
(If space is not sufficient, please enclose separate sheet)
………………………………………………………………………………………………
69
8. Whether any reply (Within a period of one month after the bank concerned
received the representation) has been received from the bank? Yes/ No
( if yes, please enclose a copy of the reply )
9. Nature of Relief sought from the Banking Ombudsman
………………………………………………………………………………
( Please enclose a copy of documentary proof, if any, in support of your claim )
10. Nature and extent of monetary loss, if any, claimed by the complainant by
way of compensation (please refer to clauses 12 (5) & 12 (6) of the Scheme) Rs.
……………….
11. List of documents enclosed:
(Please enclose a copy of all the documents )
12. Declaration:
(i) I/ We, the complainant/s herein declare that:
a) the information furnished herein above is true and correct;
and
b) I/We have not concealed or misrepresented any fact stated in the above
columns and in the documents submitted herewith.
(ii) The complaint is filed before expiry of period of one year reckoned in
accordance with the provisions of Clause 9(3)(a) and (b) of the Scheme.
(iii) The subject matter of the present complaint has never been brought before
70
the Office of the Banking Ombudsman by me/ us or by any of the parties
concerned with the subject matter to the best of my/ our knowledge.
(iv) The subject matter of the present complaint has not been decided by/pending
with any forum/court/arbitrator.
(v) I/We authorise the bank to disclose any such information/ documents
furnished by us to the Banking Ombudsman and disclosure whereof in the
opinion of the Banking Ombudsman is necessary and is required for redressal of
our complaint.
(vi) I/We have noted the contents of the Banking Ombudsman Scheme, 2006.
Yours faithfully,
(Signature of Complainant)
NOMINATION – (If the complainant wants to nominate his representative to
appear and make submissions on his behalf before the Banking Ombudsman or
to the Office of the Banking Ombudsman, the following declaration should be
submitted.)
I/We the above named complainant/s hereby nominate
Shri/Smt………………………………………….. who is not an Advocate and
whose address is
………………………………………………………………………………………………
……………………… ………
as my/our REPRESENTATIVE in all proceedings of this complaint and confirm 71
that any statement, acceptance or rejection made by him/her shall be binding on
me/us. He/She has signed below in my presence.
ACCEPTED
(Signature of Representative)
(Signature of Complainant)
Note: If submitted online, the complaint need not be signed
72
CONCLUSION
Though the Banking Ombudsman Scheme was introduced in the year
1995, with a view to do away with the banking customer complaints, the scheme
was amended in subsequent years of 2002 and 2006. But the banks do not seem
to have adopted the norms for their efficient functioning, that is the reason behind
the increasing consumer cases against the banks, which are governed under the
scheme.
In the system of Banking Ombudsman, the results are delivered very
soon, the procedures are fair together with cost, and proportionate to the nature
of the issues involved. The system deals with cases at reasonable speed, is
understandable to those who use it, is responsive to the needs of those who use
it, and provides as much certainty as the nature of particular cases allows. This is
true because over the past five years nearly 36000 complaints are being
resolved by the Banking Ombudsman under this Banking Ombudsman Scheme.
Though the Banking Ombudsman is eligible enough to deliver the bank customer
complaints at the earliest yet the Consumer Redressal Forum/Commission is
being taken resort of by most of the bank customers for their redressal of
grievances with the bank.
The reason is they are well popular among the common public which is
lacking with the banking ombudsman and its working. Definitely the Scheme
needs popularity in the society for its more appropriateness and effectiveness so
that the aggrieved bank customer with the services of the bank prefers to knock
the door of the banking ombudsman for redressal. The scheme should provide
more powers and levy more duties on the banking ombudsman so that they can
easily be approachable by the aggrieved bank customer.
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BIBLOGRAPHY
http://www.rbi.org.in/Scripts/bs_viewcontent.aspx?Id=159
http://www.rbi.org.in/Scripts/PublicationsView.aspx?id=11113#2
http://www.nos.org/Secbuscour/25.pdf
http://www.indbank.com/ombudsman.htm
http://www.ucobank.com/ombudsman.htm
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