| Date : 26 Dec 2005 |
|RBI expands Scope of Banking Ombudsman Scheme; Includes Fair Banking Practices |
The Reserve Bank of India today announced
Banking Ombudsman Scheme with enlarged scope to include customer complaints
on certain new areas, such as, 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 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 Ombudsmen.
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 Ombudsmens’ awards against banks by the
Reserve Bank. The Banking Ombudsmen currently have their offices in 15 centres.
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 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.
Chief General Manager
Press Release: 2005-2006/783