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RBI to curb banks to take customers for a ride in NE

Many banks violating the Charter of Customer Rights


GUWAHATI, April 9: The Reserve Bank of India (RBI) will soon launch a massive awareness drive in the North East to prevent both public sector and private banks to take their customers for a ride. 

Addressing a session on consumer protection and fincial inclusion during a workshop on key functions of the RBI for media persons at RBI Guwahati premises on Monday, the Executive Director of RBI in charge of Consumer Education and Protection Department Surekha Marandi said the country’s apex bank has already released a Charter of Customer Rights which enshrines broad, overarching principles for protection of bank customers and enunciates the ‘five’ basic rights of bank customers. 

According to Marandi the five basic rights of bank customers are right to fair treatment, right to transparency, fair and honest dealing, right to suitability, right to privacy and right to grievance redress and compensation. 

She said it is mandatory for each and every public sector as well private bank to follow the Charter of Customer Rights. The bank branches must prominently display the Charter of Customer Rights at their premises so that customers are not taken for a ride by any employee of a bank. 

The charter stated that customers must not be subjected to unfair business or marketing practices, coercive contractual terms or misleading representations. It also seeks to restrict practices such as the sale of unsuitable fincial products to customers such as proposals for investments in mutual funds to retired persons since market risks of such investment is very high. 

Marandi said under the right to grievance redress and compensation a bank will have to compensate the entire amount of money if someone fraudulently withdraws the amount from its customer on condition that the aggrieved customer informs the bank about the fraud within one to three days. There are provisions to compensate in case customers inform the banks about similar frauds beyond three days. In case any bank does not compensate the amount fraudulently withdrawn customers can approach the banking ombudsman for redressal of their grievances.     

According to the Charter of Customer Rights banks must keep their customers’ persol information confidential unless explicit consent is given for sharing it. Banks should keep the persol information of customers confidential unless they have offered specific consent to the bank or such information is required to be provided under a law or it is provided for a mandated business purpose.

Responding to information and queries provided by jourlists during the workshop that many customers are not aware of their rights and some banks continue to take customers for a ride, the top RBI officials present at the workshop said the RBI will soon go for a massive awareness drive in Assam and other parts of the North East.