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CONSUMER VOICE 1

Vol. XIII, Issue III March 2012 50

3/2012

Catch us also on

Editor: Roopa Vajpeyi

Chief EditorProf PK Ghosh

Mg. EditorProf Sri Ram Khanna

COOAshim Sanyal

Corporate HeadSisir Ghosh

EDITORIALEnglishLoyal LallHindiKeertana SharmaPriyanka MishraOnlineSapna SainiFood DeskAshok KanchanFinance DeskSunil PrabhakarIT DeskHemant Upadhyay

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ACCOUNTSMonender SinghSanjay Kumar

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SUBSCRIPTIONAshu BhagatFaraz Ahmed

ADMINRamanjeet KaurGovind Singh

OFFICE SUPPORTAnna DuraiM. Shivaneshan

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Consumer Protection Amendment Bill 2011 - Empowering Consumer

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CONSUMER24 VOICE http://www.facebook.com/ConsumerVoiceIndia

make a city his or her home, then

investing in an apartment is a better

option than making the owner of the

rental place richer.

In the last few years, housing loan

scenario in India has changed dras-

tically. It has taken a front seat and

people are looking forward to own-

ing their own houses. It is no more

a dream that required lifetime saving

and a difficult decision to make. To-

day home loan is much easily avail-

able and is much cheaper than what

was available earlier. Banks are now

everywhere and the schemes are im-

plemented even in villages and small-

er towns.

Home loans are a major investment

even for the upper middle class, so

showing haste is like cutting the same

branch on which we are sitting. Cera-

tin points which should be taken into

consideration before you sign the dot-

ted line are:

• First things first; make sure you

know what you want before you

take the next step.

• Select the location, and then ze-

ro-in on 3 to 4 properties. Keep

accessibility, facilities, locality as

the criteria. Doing a lot of market

research always helps.

• It is better to check your credit

history/report before you pass

your file for a home loan. Nor-

mally 80% of the loan amount is

made available by the bank, but a

good credit history can stretch it

to 85 %.

T

Purchasing the home of your

dreams is not an easy task. Es-

pecially when you plan to buy a

home on loan. Home loan means that

you buy a house on instalments. In

simpler terms when you want to own

a home and can’t afford to pay the

amount in lump sum, you can pay it in

monthly instalments with an interest

rate. Many banks are providing home

loans whether commercial banks or fi-

nancial institutions to the people who

want to had a home.

Why is Investing on a Home Loan bet-

ter than Paying the Rent? Considering

a small apartment in a metropolitan

city in India, the home loan EMI is

more or less similar to the rent that

an individual pays for an apartment.

Now, if an individual has decided to

Home Sweet Home

here are different types of home loans available in the market to

cater borrower’s different needs.

• Home Purchase Loan: This is the basic type of a home loan

which has the purpose of purchasing a new house.

• Home Improvement Loan: This type of home loan is for the

renovation or repair of the home which is already bought

• Home Extension Loan: This type of loan serves the purpose when

the borrower wants to extend or expand an existing home, like

adding an extra room etc.

• Home Conversion Loan: It is that loan wherein the borrower has

already taken a home loan to finance his current home, but now

wants to move to another home. The Conversion Home Loan helps

the borrower to transfer the existing loan to the new home which

requires extra funds, so the new loan pays the previous loan & fulfills

the money required for new home.

• Bridge Loan: This type of loan helps finance the new home of the

borrower when he wants to sell the existing home, this is normally

a short term loan to the borrower & helps during the interim period

when he wants to sell the old home & want to buy a new one, It is

given till the time a buyer is found for the old home.

• Home Construction Loan: This type of loan taken when the

borrower wants to construct a new home.

• Land Purchase Loan: It is that loan which is taken to purchase a

land for construction & investment purposes.

Confucius said the strength of a nation derives from the integrity of the home*

*but when that home comes with a bank loan, payble over years, then what? MA

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CONSUMER24 VOICE

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• Have some spare cash to pay for

miscellaneous aspects like taxes,

paperwork etc.

• Understand all the aspects of the

home loans through your bank/

Housing Finance Company

In order to assess the quality of serv-

ice provided by the Home Loan pro-

viders we conducted survey in twelve

states of India, namely, Delhi, Rajas-

than, Punjab, Haryana, West Bengal,

Uttar Pradesh, Madhya Pradesh, Ma-

harashtra, Gujarat, Karnataka, Tamil

Nadu and Andhra Pradesh. About

3100 respondents who have taken

home loan from the Banks or Housing

Finance Companies were contacted to

find out the level of their satisfaction

with the kind of service provided by

the Bank/HFCs.

As shared earlier, taking a home loan

is not a difficult task now. However,

before taking a loan, one must real-

ize that the relationship with the bank

will be for a longer period usually 15

to 20 years so one must ensure faith

and integrity in bank. This faith comes

in the customer from his satisfaction

level with the services provided by

these Banks/HFCs. In our study, with

a mean score of 7.86, Housing De-

velopment Finance Corporation Lim-

ited (HDFC) has come out to be the

winner in overall satisfaction of the

customers with the Bank/HFCs. Close

on the heels is Central Bank of In-

dia with the mean score of 7.83. Not

far behind are Canara Bank and SBI

Home Finance Ltd, both of them scor-

ing 7.78 points on global satisfaction.

Others who have scored above aver-

age include LIC Housing Finance Lim-

ited, Axis Bank, State Bank Of India,

Punjab National Bank and Standard

Chartered Bank.

Nevertheless Housing Development

Finance Corporation Limited (HDFC)

is the top scorer Housing Finance

Key Findings

• The best score for customer

satisfaction goes to Housing

Development Finance Cor-

poration Limited (HDFC).

• Housing Development Fi-

nance Corporation Limited

(HDFC) scored high in all

the tests.

• SBI Home Finance Limited

is the best recommended

Home loan finance com-

pany amongst the others

surveyed, Housing Devel-

opment Finance Corpora-

tion Limited (HDFC) follows

closely.

• LIC Housing Finance Lim-

ited leads the race when it

comes to customer’s sat-

isfaction with respect to

Home Loan Procedure and

Payment procedure.

• Close to 91% of the cus-

tomers hold the view that

there is biased treatment

between a Government

employee and a Private em-

ployee when it comes to the

loan amount.

• Attractive interest rate

tempts the borrower to-

wards the Home loan pro-

viders, be it a Bank or a

HFC.

The study substantiates the fact

that public sector Banks/HFCs

are the most trusted ones to ap-

proach for home loan schemes.

The results of our survey show

that out of top 4 banks/HFCs to

get the highest overall satisfac-

tion level 3 were public sector

banks/HFCs. These were Cen-

tral Bank of India, SBI Home

Finance Ltd and LIC Housing

Finance Limited.

Company amongst other banks/HFCs

covered in the study.

SBI Home Finance Limited has

outrun others when it comes to

customer’s recommendation. It has

scored ahead of all other Banks/HFCs

as 97.6% of its customers have rec-

ommended the HFC to their friends

and relatives. Housing Development

Finance Corporation Limited (HDFC)

stands close by, with 97.5% of its cus-

tomers recommending the HFC. The

7.76

7.78

7.78

Central Bank Of India

SBI Home Finance Ltd

Housing Development Finance …

7.73

7.74

7.75

IDBI Bank

Standard Chartered Bank

LIC Housing Finance Limited

7 66

7.68

7.71

7.71

Union Bank

Punjab National Bank

HDFC Bank

Axis Bank

7.65

7.65

7.66

7.66

Bank Of India

ING Vysya Bank

ICICI Home Finance Company Limited

Union Bank

7.63

7.64

7.65

State Bank Of India

Canara Bank

Bank of Baroda

7.60

7.60

7.63

IDBI Home Finance Limited (IHFL)

ICICI Bank

Tata Housing Finance Ltd

All Banks/HFCs

7.33

7.55

Others

PNB Housing Finance Limited 7.68

Service Test

Over all Satisfaction Shown by Consumers

http://twitter.com/#!/consumervoice1

least recommended hospital is Bank

of India as only 65.3% of its customer

would recommend this Bank.

GOODBYE TO CUMBERSOME

HOME LOAN PROCEDURE!

Taking home loans these days has be-

come simpler. While applying for the

home loan, the home loan seeker has

to submit the necessary documents

to the bank which will be verified to-

gether with the details in the applica-

tion. Our study reveals that for more

than half of the respondent’s valida-

tion was done through verification of

residential address and for 33% vali-

dation was done through verification

of the place of employment. More

than 86% of the respondents have

also revealed that validation was done

within 8 to 15 days after submission

of application. However, despite the

fact that majority of the customers

(close to 68%) have revealed that

loan was disbursed within 8 to 15

days of submitting the sanction let-

ter by the Bank/HFC, substantial per-

centage of the customers (more than

85%) holds the view that there was

unnecessary delay in disbursement of

the home loan.

When it comes to recording the satis-

faction level of the customers with the

Home loan procedure of the

Banks/HFCs, LIC Hous-

ing Finance Limited

leads the race. With a

score of 8.05, it is the

highest scorer HFC

in terms of satisfac-

tion with Home Loan

Procedure. SBI Home

Finance Ltd, Housing

Development Finance

Corporation Limited

(HDFC), Canara Bank

and Central Bank of

India with scores in the range of 7.80

to 7.87 follow LIC Housing Finance

Limited.

RELAXATION IN THE PAY-

MENT PROCEDURE BY THE

BANKS/ HFCS

The strictness of banks in paying the

monthly instalments on due date has

changed over the years. Now the

banks have taken a somewhat leni-

ent approach by providing flexibil-

ity on due date of paying EMI. Our

study shows that more than 94% of

the surveyed customers accept that

their Bank/HFC provides this flexibil-

ity. Close to 91% of the customers

also disclosed that their Bank/HFC

approve postponing the EMI to the

subsequent month in order to avoid

default. Not only this, the Banks/

HFCs now also provide the option of

re-scheduling EMI as the customer’s

repaying capacity increases, substan-

tiated by more than 68% of the sur-

veyed customers. In addition, around

99% of the customers confirmed that

they did not have to pay any process-

ing fee. Bank/HFCs have also gone

ahead in informing their customers

the reduction in principal loan amount

by sending statements. Close to 80%

of the customers disclosed that they

receive monthly statement from their

Bank/HFC.

LIC Housing Finance Limited, with the

mean score 7.94, is again on top of

the satisfaction level with the payment

procedure. Not far behind is Housing

Development Finance Corporation

Limited (HDFC) with a mean score of

7.81. Apart from these two HFCs, six

more Banks/HFCs have scored above

the average score of 7.67.

GROWING AWARENESS

AMONG CUSTOMERS

The customers interested in taking

Home Loans from Banks/HCs should

make it a point to go through the

terms and conditions of the Bank/

29.6% 64.8% 94.4%SBI Home Finance Ltd

definitely yes probably yes

23 8%

21.3%

16.0%

43.0%

29.6%

67 8%

70.6%

76.5%

49.6%

64.8%

91 6%

91.9%

92.5%

92.6%

94.4%

IDBI Bank

Standard Chartered Bank

Central Bank Of India

HDFC Limited

d

20 5%

24.1%

39.4%

24.4%

23.8%

66 3%

63.0%

47.9%

63.8%

67.8%

%

87.1%

87.3%

88.2%

91.6%

HDFC B k

Axis Bank

Punjab National Bank

LIC Housing Finance Limited

IDBI Bank

22.7%

28.0%

46.0%

20.5%

61.8%

57.5%

39.6%

66.3%

84.5%

85.5%

85.6%

86.8%

IDBI Home Finance Limited …

Total

Canara Bank

HDFC Bank

26.2%

16.7%

26.5%

25.4%

57.0%

66.7%

57.3%

59.0%

83.2%

83.4%

83.8%

84.4%

Union Bank

Others

State Bank Of India

ICICI Home Finance …

27.3%

25.9%

30.9%

42.7%

54.5%

56.1%

51.5%

40.2%

81.8%

82.0%

82.4%

82.9%

PNB Housing Finance Limited

ING Vysya Bank

Tata Housing Finance Ltd

ICICI Bank

12.8%

26.1%

27.3%

56.4%

53.4%

54.5%

79.5%

8 .8%

69.2%Bank Of India

Bank of Baroda

PNB Housing Finance Limited

Service Test

HSCs/Banks Recommended to Friends

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CONSUMER26 VOICE

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CONSUMER VOICE 27

HFC providing Home loan before tak-

ing the loan. And it should be kept in

mind that signing documents of loan

means borrower has agreed to all

terms and conditions which include

amount of loan, repayment and ap-

proval inclusive of mandate that he

agrees to pay any kind of charge,

if mentioned. High level of aware-

ness on this aspect could be noted

amongst the surveyed customers, as

revealed by 95% of them. Also, close

to 91% of the customers hold the

view that loan amount differ on basis

of the applicant being a Government

or a Private employee.

On being asked whether they are

aware that the Bank/HFC has a right

to ask for additional margin or more

securities if the value of the collateral

goes down in the market even after

paying timely EMI, it was found that

95% of the customers are aware of

this. Of those who were aware, about

93% had been penalized for the same

in terms of bridging the shortfall.

The awareness of the borrowers on

the foreclosure charges (i.e. prepay-

ment penalty) that have to be paid to

the Bank/HFC in case the borrower

repays the full loan amount before

time period was also found to be

reasonably high. More than 86% of

the survey customers have affirmed

that they know about the foreclos-

ure charges. This shows that people

Did you ever have a problem with the Bank/HFC?

ING Vysya (39.6%)

IDBI Home Finance Limited (IHFL) (39.1%)

IDBI Bank (38.5%)

Standard Chartered Bank (38.2%)

Did you complain to the Bank/HFC about it?

SBI Home Finance Ltd (100.0%)

Tata Housing Finance Ltd (97.3%)

Axis Bank (96.9%)

IDBI Bank (96.4%)

Was your problem solved?

Canara Bank (92.9%)

Tata Housing Finance Ltd (85.4%)

Axis Bank (83.9%)

Bank Of India (82.7%)

of this decade are much more aware

and sincere when it comes to invest-

ing their hard earned money.

FIRST PREFERENCE TO

BANKS/HFCS OFFERING AT-

TRACTIVE INTEREST RATES

Attractive interest rate has emerged

as the foremost important reason

for a borrower to choose amongst

the gamut of Home Loan providers.

Around 38% of the borrowers have

revealed that they had chosen the

Bank/HFC based on their interest

rates on which they provide loan.

Early bird incentive, i.e., availing the

benefits of first come first serve, is

the second most important reason

for a borrower to decide his home

loan financer. Last but not the least

is the flexibility in payment proce-

dure which is the third most signifi-

cant reason for the borrower. The

top three reasons for selecting the

Bank/HFC are;

1st reason: Attractive interest rate

(37.6%)

2nd reason: Early bird incentive

(32.6%)

3rd reason: Flexibility, i.e. gestation

period (30.0%)

HOW WE TESTED

The study Assessment of Quality of

Home Loan was done by VOICE Soci-

ety with support from Union Ministry

of Consumer Affairs, Govt. of India.

A total of twelve states and more

than 20 Banks/HFCs were chosen.

The selection of states was based on

the amount of credit limit in that par-

ticular state. The state wise sample

was further divided in to those cities

where the major property develop-

ment activities are taking place. A

total of 3100 Home Loan borrowers

were selected who had taken home

loan from either bank or a housing fi-

nance company. This is the first test

of its kind in this sector.

Service Test

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CONSUMER28 VOICE

ELIGIBILITY

Age criteria:You must be least 21

years of age on sanction of loan. But

co-applicant can even bean 18 years

of age.

Home loan payments must be com-

pleted before or at 65 years of age or

age of retirement, which is earlier.

You must be earning: salaried or self-

employed with a regular source of

income.

ENHANCE YOUR ELIGIBILITY

Make your spouse co-applicant if

she is also earning, her income will

be considered to enhance your

eligibility.

For Joint ownership it is necessary

that all co-owners must be co-appli-

cants also, get their consent before

applying for home loan.

DOCUMENTS REQUIRED

In case you are an employee in regu-

lar job:

Application form with photograph duly

signed by all applicants , including co-

owners: whether earning or not.

Proof-Identity, Residence and Age

Last 3 months Salary-slips

Form 16/Income tax return

Last 6 months bank statements

Processing fees - 0.50% or maxi-

mum 1.00% + applicable service tax

and surcharge on amount of home

loan applied, this is upper limit can

be negotiate with bank to take small

lump-sum.

FOR SELF EMPLOYED OR

PROFESSIONALS

In place of salary slips, last 3 years

Income tax returns with computation

of income required.

Before You Get a Home Loan

Last 3 years CA Certified/Audited

Balance Sheet and Profit & Loss Ac-

count.

Proof of business existence is re-

quired.

For Non- Professional self employed

Additionally business profile is re-

quired.

HOW MUCH MAXIMUM LOAN

YOU CAN TAKE?

Maximum home loan banks can sanc-

tion is 80% of value of your property.

i.e on Value of property of Rs 50 lack

you can apply upto Rs 40 lacs.

RBI CHANGES HOME LOAN

NORMS IN JANUARY 2012

Home loan borrowers were required

to bring 20% on their own as loan

to value ration, however in January

RBI directed bank not to finance

various home loan related transac-

tion charges like stamp duty, reg-

istration charges and various levies

like surcharges. This latest move by

RBI increases home loan borrower’s

contribution to 30% of the value of

property thus reduces maximum loan

amount to just 70%.

Have less money still take 90% loan

Consumers should take Advantage

by buying flat worth Rs 20 lacs, they

need to invest just Rs 2 lac rest Rs18

lacs they can take loan of.

ADVOCACY BY CONSUMER

VOICE

Consumer voice in interest of home

loan consumers is doing advocacy

to increase home loan limits under

priority sector from Rs 20 lacs to Rs

30 lacs due to steep hike in prices of

properties.

INCOME TAX BENEFIT FOR

HOME LOAN BORROWER

Interest paid on home loan can be

claimed as deduction from taxable in-

come unto Rs 1.50 lacs on self occu-

pied house. Even paying principle in

EMI (installment minus interest) can

be claimed from taxable income upto

Rs 1 lac.

PRE-PAYMENT PENALTY

STILL TO BE PAID

Under RBI directive banks are advised

not to charge foreclosure charges

from the home loan consumers who

have take home loan on floating rate

of interest. But consumers are still re-

quired to pay pre-payment charges if

they have taken home loan on fixed

rate of interest.

IF YOU DIE AND HOME LOAN

IS STILL PENDING

Your house is mortgaged to the bank

even if you die, co-owner can pay the

loan. Normally banks ask you to take

life insurance policy before sanction-

ing loan which is also pledged with

them, and death claim can be adjust-

ed against pending home loan.

Consumers must exercise their rights

as home loan borrowers under con-

sumer protection act 1986. Home loan

borrowers have a right to be treated

with respect , a bank may be held li-

able for deficiency in services owing

to rude behavior by its officials and

compensation for the mental agony

and discomfort can be claimed.

Also under COPRA home loan bor-

rower can hold the bank liable for

deficiency in services in case, after

repaying whole amount of home loan,

the bank fails to return title deed and

other security documents back to the

borrowers.

By Sunil Prabhakar

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World Consumer Rights Day SPECIAL

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India support wholeheart-

edly: *Our money, our

rights: campaigning for real

choice in financial serv-

ices which is theme for

World Consumer Rights Day

(WCRD) 2012*

India received the most remittances

(US $ 55 BILLION) during 2010 from

Indian workers around the world.

The amount is significant since it is

just 0.9% of Indian population out

of Total Indian Population of 1155.3

(MILLIONS, 2009), which is even

lower than population average annual

growth rate of 1.5 % (2000-09).

Besides United States, top most

destinations for Indian Workers are

United Arab Emirates & Saudi Arabia.

Working in alien and sometimes hostile

environment surely calls for stopping

exorbitant charges for sending money

home. Due to a lack of an alternate

rule non- resident Indians are forced

to send money through Western

Union Money Transfer which has a

monopolistic position. This campaign

highlights lack of real choice in

financial services.

INDIAN SAVING ABROAD

NEEDS PROTECTION

Action on money transfers requires

making a right choice so the cost of

sending money home is addresses,

which is the most pressing need

of Indian workers, whose hard-

earned savings are pocketed first

by unfavorable exchange rate and

secondly through high transaction cost

in form of hidden handling charges.

It is pertinent to know that campaign

for real choice in the financial

services is extremely important as in

some mode, invariably also includes

cost paid by the receiver in the form

of handling charges. Because cost of

transfer also include charges levied

by the receiving bank when the

beneficiary is customer of another

domestic bank. And the charges

become steeper if the receiver is in

remote locations where the funds are

delivered by the receiving bank by

making a rupee demand draft.

OPTIONS USED TO SEND

MONEY TO INDIA

Gulf Region which is number 1 des-

tination of Indian workers, operates

through special arrangement with

overseas correspondent banks and

MONEY

TRANSFER....

Finance

World Consumer Rights Day SPECIAL

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local private exchange houses be-

cause very few Indian banks have

presence in the region. banks in

India have entered into Rupee

Drawing Arrangements (RDA) with

PEHs (PRIVATE EXCHANGE HOUS-

ES) in the Gulf Region and also in

Singapore and Hong Kong. The

Tie-ups are with the agencies such

as UAE Exchange Centre, Al- Fardan

Exchange, UAE, Bahrain, Oman/Gulf,

Exchange Company, Kuwait India

International Exchange, Mustafa Sul-

tan Exchange Co. At Present, around

35 banks have entered into 200 RDA’S

with Exchange Houses. The use of

such formats is rising significantly in

the case of Kerala – in India. In north-

ern part of India Xpress Money, Re-

mit 2 India, Money Gram are used as

option, where as many bank branch-

es of north-eastern regions have

made arrangements with Western

Union Money Transfer to facilitate

remittance into India.

RAMITTANCE MODE

Instruments used for sending

remittance to India are SWIFT/

Electronic Wires, Drafts, Cheques,

Debit/Credit Cards, Money Orders,

Direct Transfer to Banks.

VARIANTS OF SENDING

MONEY TO INDIA

Hawala, by law is banned in India but

was most attractive to customers as

it bypasses official exchange rates,

avoids any fixed bank charges and of

–course service tax on those charges.

The unique feature of the system is

that no promissory instruments are

exchanged between the Hawalas

brokers; the transaction takes place

entirely on personal power equations.

As the system does not depend on the

legal enforceability of claims, it can

operate even in the absence of a

legal and juridical environment, Trust

and extensive use of connections,

such as family relations and regional

Comparative TestFinance

affiliations, are the components that

distinguish it from other remittance

systems.

In other parts of the world, Hawala

is the only option available for

legitimate funds transfers, and has

even been used by aid organizations in

areas where it is the best functioning

institution.

Hundis, the most important legal

financial instruments evolved in India

was used in twelfth century, and has

continued till today. In real sense,

Hundis represent the oldest surviving

form of credit instrument. Hundis

were used as remittance instruments

to transfer funds from one place to

another. Like Hawala they are part

of informal system, have no legal

status, and were not covered under

Negotiable Instruments Act, 1881.

Nevertheless, unlike Hawala, Hundis

escape ban in India.

Sunil Prabhakar

Date: Feb 29,2012

Sd/

MA

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CONSUMER32 VOICE http://young.consumer-blog.blogspot.com/

MANAGEMENT QUOTA: BANKS

WITHDRAW EDUCATION LOANS

In a move that will impact future management and

engineering hopefuls, students who opt for these

subjects under the management quota in India and

abroad will no longer be given education loans. The

apex body of banks, the Indian Banks Association

(IBA), has debarred the Management quota from

the education loan scheme in a bid to bring down

increasing bad assets from education loans.

NEW RBI HOME LOAN NORMS A DAMPENER

It's going to get a little more difficult to buy a home. Home

loan seekers will now have to fund about 30% of the total

cost of a house from their own resources for the Reserve

Bank has just mandated that banks should exclude stamp

duty and registration charges while calculating the property

value. Earlier, banks would include these in the Property

value, and expected home loan borrowers to bring in

20% of the total

value as margin

money. The ratio

of the loan amount

to the value of the

property, called loan

to value, cannot

exceed 80%.

The RBI's move

is an attempt

to introduce an

additional lever

to ensure that

the buyer does

not overstate the

realizable value of the property. This is an

important metric for banks in the

event that the borrower

defaults.

COMPANIES

TO RESERVE 15%

IN SHARE BUYBACK OFFER FOR

SMALL INVESTORS: SEBI

In a investor friendly move securities

exchange board of India made 15% in share

buyback reservation for small investors. ""..

fifteen percent of the number of securities

which the company proposes to buy back

or number of securities entitled as per their

shareholding, whichever is higher, shall be

reserved for small shareholders," Sebi said in

its revised regulations.

RESERVE

BANK

EASES RULES FOR

REPAYMENT OF FIXED

DEPOSITS.

In yet another customer-friendly move, the Reserve

Bank of India said signatures of both depositors are not

needed for repayment of fixed or term deposits on maturity if

such accounts are opened with instructions "either or survivor".

In a recent notification, the RBI said that some banks insist on the signatures of both the

depositors to allow repayment of money in fixed/term deposits, though the deposit account

is opened with operating instructions (sometimes called 'repayment instructions'), 'either or

survivor' or 'former or survivor'. "Such insistence on the signatures of both the depositors has

the effect of making the mandate given by the depositors redundant. This, in turn, results in

unjustified delays and allegations of poor customer service," said the notification.MA

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CONSUMER32 VOICE http://www.facebook.com/ConsumerVoiceIndia

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