Introduction
Series of studies have been conducted by
various committees such as the Talwar Committee, Goiporia Committee,
Tarapore Committee, etc., to bring in improvement in performance and
procedure involved in the dispensation of hassle-free customer service.
Depositors' interest forms the focal
point of the regulatory framework for banking in India.
Broadly, a customer can be defined as a
user or a potential user of bank services. So defined, a ‘Customer’ may
include:
•
a
person or entity that maintains an account and/or has a business relationship
with the bank;
•
one
on whose behalf the account is maintained (i.e. the beneficial owner);
•
beneficiaries
of transactions conducted by professional intermediaries, such as Stock Brokers,
Chartered Accountants, Solicitors, etc., as permitted under the law, and
•
any
person or entity connected with a financial transaction which can pose
significant reputational or other risks to the bank, say, a wire transfer or
issue of a high value demand draft as a single transaction.
General
Policy for general
management of the branches
Banks should have a Board approved policy for
general management of the branches which may include the following aspects:-
(a)
providing
infrastructure facilities like adequate space, proper furniture, drinking water
facilities, with specific emphasis on pensioners, senior citizens, disabled
persons, etc.
(b)
providing
entirely separate enquiry counters at their large / bigger branches.
(c)
displaying
indicator boards and Business posters at all the counters in English, Hindi as
well as in the concerned regional language.
(d)
posting
roving officials to ensure employees' response to customers and for helping out
customers in putting in their transactions.
(e)
Providing
customers with booklets consisting of all details of service and facilities
available at the bank in Hindi, English and the concerned regional languages.
(f)
Use
of Hindi and regional languages in transacting business by banks with
customers, including communications to customers.
(g)
Reviewing
and improving upon the existing security system in branches.
(h)
Wearing
an identification badge displaying photo and name thereon by the employees.
(i)
Periodic
change of desk and entrustment of elementary supervisory jobs.
(j)
Training
of staff in line with customer service orientation.
(k)
visit
by senior officials from Controlling Offices at periodical intervals for on the
spot study of the quality of service rendered by the branches.
(l)
rewarding
the best branches from customer service point of view by annual awards/running
shield.
(m)
Customer
service audit, Customer surveys.
(n)
holding
Customer relation programmes and periodical meetings.
(o)
clearly
establishing a New Product and Services Approval Process which should require
approval by the Board especially on issues which compromise the rights of the Common
Person.
(p)
appointing
Quality Assurance Officers who will ensure that the intent of policy is
translated into the content and its eventual translation into proper
procedures.
Customer
Service: Institutional Framework
Need for Board's
involvement
Matters relating to customer service should
be deliberated by the Board to ensure that the instructions are implemented
meaningfully.
Banks are required to constitute a Customer
Service Committee of the Board and include experts and representatives of
customers as invitees to with a view to strengthening the corporate governance
structure in the banking system and also to bring about ongoing improvements in
the quality of customer service provided by the banks.
Role of the Customer
Service Committee
Customer Service
Committee of the Board, illustratively, could address the following:-
•
formulation
of a Comprehensive Deposit Policy
•
issues
such as the treatment of death of a depositor for operations of his account
•
product
approval process with a view to suitability and appropriateness
•
annual
survey of depositor satisfaction
•
tri-enniel audit of such services.
Besides, the Committee could also examine any
other issues on the quality of customer service.
Monitoring the implementation of awards under
the Banking Ombudsman Scheme
The Committee should observe the complaints /
grievances resolved by Banking Ombudsmen of the various States. Banks should ensure
that the Awards of the Banking Ombudsmen are implemented expeditiously and with
active involvement of Top Management.
Further,
with a view to enhancing the effectiveness of the Customer Service Committee,
banks should
a)
place
all the awards given by the Banking Ombudsman before the Customer Service
Committee to enable them to address issues of systemic deficiencies existing in
banks, and
b)
Place all the awards remaining unimplemented for more
than three months to
report to the Board.
Board Meeting to
Review and Deliberate on Customer Service
Banks are advised to review customer service
/ customer care aspects in the bank and submit a detailed memorandum in this
regard to the Board of Directors, once every six months and initiate
prompt corrective action wherever service quality / skill gaps have been
noticed.
Standing Committee on Customer Service
The Committee on Procedures and
Performance Audit of Public Services (CPPAPS) therefore recommended that
the Ad hoc Committees should be converted into Standing Committees on Customer Service.
The constitution and functions of the Standing Committee may be on the lines
indicated below:-
i)
The
Standing Committee may be chaired by the CMD or the ED and include
non-officials as its members to enable an independent feedback on the quality
of customer service rendered by the bank.
ii)
The
Standing Committee may be entrusted not only with the task of ensuring timely
and effective compliance of the RBI instructions on customer service, but also
that of receiving the necessary feedback to determine that the action taken by
various departments of the bank is in tune with the spirit and intent of such
instructions.
iii)
The
Standing Committee may review the practice and procedures prevalent in the bank
and take necessary corrective action, on an ongoing basis as the intent is
translated into action only through procedures and practices.
iv)
A
brief report on the performance of the Standing Committee during its tenure
indicating, inter alia, the areas reviewed, procedures / practices identified
and simplified / introduced may be submitted periodically to the Customer
Service Committee of the Board.
With the conversion of the Ad hoc Committees
into Standing Committees on Customer Service, the Standing Committee will act
as the bridge between the various departments of the bank and the Board /
Customer Service Committees of the Board.
Branch Level Customer Service Committees
Banks were advised to establish Customer
Service Committees at branch level. As senior citizens usually form an
important constituent in banks, a senior citizen may preferably be included
therein. The Branch Level Customer Service Committee may meet at least once
a month to study complaints/ suggestions, cases of
delay, difficulties faced / reported by customers / members of the Committee
and evolve ways and means of improving customer service.
The branch level committees may also submit
quarterly reports giving inputs / suggestions to the Standing Committee on
Customer Service
thus enabling the Standing Committee to examine them and provide relevant
feedback to the Customer Service Committee of the Board for necessary policy /
procedural action.
Nodal department / official for customer
service
Each bank is expected to have a nodal
department / official for customer service in the Head Office and each
controlling office, with whom customers with grievances can approach in the
first instance and with whom the Banking Ombudsman and RBI can liaise.
Board approved policies on Customer Service
Customer service should be projected as a
priority objective of banks along with profit, growth and fulfillment of social
obligations. Banks should have a Board approved policy for the following:
Comprehensive Deposit Policy
By setting out the rights of the depositors,
the policy would be required to cover all aspects of operations of deposit
accounts, charges and other related issues. Providing other facilities by
"tying-up" with placement of deposits is clearly a restrictive
practice.
Cheque Collection Policy
By taking into account their technological
capabilities, systems and processes adopted for clearing arrangements and other
internal arrangements for collection through correspondents.
•
Immediate Credit for Local / Outstation cheques
•
Time frame for Collection of Local / Outstation
Instruments
•
Interest payment for delayed collection
Customer Compensation Policy
CAP should be based on IBA’s model policy. Banks
policy should, incorporate the following aspects:-
(a)
Erroneous
Debits arising on fraudulent or other transactions
(b)
Payment
of interest for delays in collection
(c)
Payment
of interest for delay in issue of duplicate draft
(d)
Other
unauthorised actions of the bank leading to a financial loss to customer
Customer Grievance Redressal Policy
Banks must have a well documented Customer
Grievance Redressal Policy duly approved by their Boards.
Giving publicity to the policies
(i)
Banks
should ensure that wide publicity is given to the above policies on the web-site
and displaying them on the notice board in their branches.
(ii)
The
customers should be clearly apprised of the assurances of the bank on the
services on these aspects at the time of establishment of the initial
relationship.
(iii)
Further, they may also take necessary steps to keep the customers duly informed
of the changes in the policies formulated by them from time to time.
Financial Inclusion
Basic Savings Bank
Deposit Account (BSBDA)
Banks are advised to
offer a 'Basic Savings Bank Deposit Account' which will offer following minimum
common facilities to all their customers:
i.
The
'Basic Savings Bank Deposit Account' should be considered a normal banking
service available to all.
ii.
This
account shall not have the requirement of any minimum balance.
iii.
The
services available in the account will include deposit and withdrawal of cash
at bank branch as well as ATMs; receipt / credit of money through electronic
payment channels or by means of deposit / collection of cheques drawn by
Central / State Government agencies and departments.
iv.
While
there will be no limit on the number of deposits that can be made in a month,
account holders will be allowed a maximum of four withdrawals in a month,
including ATM withdrawals.
v.
Facility
of ATM card or ATM-cum-Debit Card.
vi.
The
above facilities will be provided without any charges. Further, no charge will
be levied for non-operation / activation of in-operative 'Basic Savings Bank
Deposit Account'.
vii.
Banks
would be free to evolve other requirements including pricing structure for
additional value-added services beyond the stipulated basic minimum services on
reasonable and transparent basis and applied in a non-discriminatory manner.
viii.
The
'Basic Savings Bank Deposit Account' would be subject to RBI instructions on Know
Your Customer (KYC) / Anti-Money Laundering (AML) for opening
of bank accounts issued from time to time. If such account is opened on the
basis of simplified KYC norms, the account would additionally be treated as a
'Small Account'
ix. Holders of 'Basic Savings
Bank Deposit Account' will not be eligible for opening any other savings bank
deposit account in that bank. If a customer has any other existing savings bank
deposit account in that bank, he / she will be required to close it within
30 days from the date of opening a 'Basic Savings Bank Deposit Account'.
x. The existing basic
banking 'no-frills' accounts should be converted to 'Basic Savings Bank Deposit
Account' as per the instructions contained above.
BSBDA – Frequently
Asked Questions (FAQs)
In
view of several queries received in connection with BSBDAs, a list of FAQs was
issued. These FAQs are furnished in Annex VII.
IT-enabled Financial Inclusion
A few banks have already initiated certain
pilot projects in different remote parts of the country utilizing smart
cards/mobile technology to extend banking services similar to those dispensed
from branches. Banks are, therefore, urged to scale up their financial
inclusion efforts by utilizing appropriate technology. Care may be taken to
ensure that the solutions developed are:
• highly secure,
• amenable to audit and
• follow widely
accepted open standards to allow inter-operability among the different systems
adopted by different banks.
Printed material in trilingual form
All printed material used by retail customers
including account opening forms, pay-in-slips, passbooks, etc., in trilingual
form i.e., English, Hindi and the concerned Regional Language.
Rights of Transgender
Persons – Changes in bank forms/ applications etc.
Banks are, therefore, directed to include
‘third gender’ in all forms/applications etc. prescribed by the Reserve Bank or
the banks themselves, wherein any gender classification is envisaged.
Opening / Operation
of Deposit Accounts
Customer Identification Procedure for individual
accounts
Banks
should be generally guided by RBI instructions on KYC / AML for opening of
accounts.
Banks are advised that KYC once done by one
branch of the bank should be valid for transfer of the account within the bank
as long as full KYC has been done for the concerned account. The customer
should be allowed to transfer his account from one branch to another
branch without insisting on fresh proof of address and on the basis of a
self-declaration from the account holder about his / her current address, subject
to submitting proof of address within a period of six months. Periodical
updation of KYC data would continue to be done by bank as per prescribed
periodicity.
Savings Bank Rules
As many banks are now
issuing statement of accounts in lieu of pass books, the Savings Bank Rules
must be annexed as a tear-off portion to the account opening form so that the
account holder can retain the rules.
Photographs of
depositors
Banks should obtain and keep on record
photographs of all depositors/account holders in respect of accounts opened by
them subject to the following clarifications:
(i)
The
instructions cover all types of deposits including fixed, recurring,
cumulative, etc.
(ii)
They
apply to all categories of depositors, whether resident or non-resident. Only
banks, Local Authorities and Government Departments (excluding public sector
undertakings or quasi-Government bodies) will be exempt from the requirement of
photographs.
(iii)
The
banks may not insist on photographs in case of accounts of staff members only
(Single/Joint).
(iv)
The
banks should obtain photographs of all persons authorised to operate the
accounts viz., Savings Bank and Current Accounts without exception.
(v)
The
banks should also obtain photographs of the ' Pardanishin' women.
(vi)
The
banks may obtain two copies of photographs and obtaining photocopies of driving
license/passport containing photographs in place of photographs would not
suffice.
(vii)
The
banks should pay 'self' or 'bearer' cheques in cash by taking usual precautions
without insisting on the presence of account holder unless the circumstances so
warrant.
(viii) Photographs cannot be
a substitute for specimen signatures.
(ix)
Only
one set of photographs need be obtained and separate photographs should not be
obtained for each category of deposit. The applications for different types of
deposit accounts should be properly referenced.
(x)
Fresh
photographs need not be obtained when an additional account is desired to be
opened.
(xi)
In
the case of operative accounts, viz. Savings Bank and Current accounts,
photographs of persons authorised to operate them should be obtained. In case
of other deposits, viz., Fixed, Recurring, Cumulative, etc., photographs of all
depositors in whose names the deposit receipt stands may be obtained except in
the case of deposits in the name of minors where guardians' photographs should
be obtained.
Minimum balance in
savings bank accounts
At the time of opening the accounts, banks
should inform their customers about the requirement of maintaining minimum
balance and levying of charges, etc., if the minimum balance is not maintained.
Any charge levied subsequently should be transparently made known to all
depositors in advance with one month’s notice. With effect from May 6, 2014,
banks are not permitted to levy penal charges for non-maintenance of minimum
balances in any inoperative account.
Levy of Penal Charges on Non-Maintenance of
Minimum balance in savings bank accounts
(i)
In
the event of a default in maintenance of minimum balance / average minimum
balance as agreed to between the bank and customer, the bank should notify the
customer clearly by SMS / email / letter etc. that in the event of the minimum
balance not being restored in the account within a month from the date of
notice, penal charges will be applicable.
(ii)
In
case the minimum balance is not restored within a reasonable period, which
shall not be less than one month from the date of notice of shortfall, penal
charges may be recovered under intimation to the account holder.
(iii) The policy on penal
charges to be so levied may be decided with the approval of Board of the bank.
(iv)
The
penal charges should be directly proportionate to the extent of shortfall
observed. In other words, the charges should be a fixed percentage levied on
the amount of difference between the actual balance maintained and the minimum
balance as agreed upon at the time of opening of account. A suitable slab
structure for recovery of charges may be finalized.
(v)
It
should be ensured that such penal charges are reasonable and not out of line
with the average cost of providing the services.
(vi)
It
should be ensured that the balance in the savings account does not turn into
negative balance solely on account of levy of charges for non-maintenance of
minimum balance.
These guidelines should be brought to the
notice of all customers apart from being disclosed on the bank's website.
Purchase
of Local Cheques, Drafts, etc., during suspension of Clearing
Whenever clearing is suspended and it is
apprehended that the suspension may be prolonged, banks may temporarily
accommodate their constituents, by purchasing the local cheques, drafts, etc.,
deposited in their accounts for collection. While extending this facility,
banks would no doubt take into consideration such factors as creditworthiness,
integrity, past dealings and occupation of the constituents.
Statement of accounts / Pass Books
Issuance
of Passbooks to Savings Bank Account holders (Individuals)
Banks are advised to invariably offer pass
book facility to all its savings bank account holders (individuals) and in case
the bank offers the facility of sending statement of account and the customer
chooses to get statement of account, the banks must issue monthly statement of
accounts. The cost of providing such Pass Book or Statements should not be
charged to the customer.
Updating passbooks
(i)
Wherever
pass-books are held back for updating, because of large number of entries,
paper tokens indicating the date of its receipt and also the date when it is to
be collected should be issued.
(ii)
Whenever
a passbook is tendered for posting after a long interval of time or after very
large number of transactions, a printed slip requesting the depositor to tender
it periodically should be given.
Entries in passbooks / statement of accounts
(i)
Banks
should give constant attention to ensure entry of correct and legible
particulars in the pass books and statement of accounts.
(ii)
Banks
should avoid inscrutable entries in passbooks / statement of accounts and
ensure that brief, intelligible particulars are invariably entered in passbooks
/ statement of account.
Maintenance of
savings bank pass books: precautions
A few precautions in this regard are given
below:
(i)
Branches
should accept the pass books and return them against tokens.
(ii) Pass books remaining
with the branches should be held in the custody of named responsible officials.
(iii) While remaining with
the branch, pass books should be held under lock and key overnight.
Providing monthly
statement of accounts
(i)
Banks
may ensure that they adhere to the monthly periodicity while sending statement
of accounts.
(ii)
The statements of accounts for current account holders may be sent to the
depositors in a staggered manner instead of sending by a target date every
month. The customers may be informed about staggering of the preparation of
these statements.
(iii)
Further,
banks should advise their Inspecting Officers to carry out sample check at the
time of internal inspection of branches to verify whether the statements are
being dispatched in time.
Address / Telephone Number of the Branch in
Pass Books / Statement of Accounts
Banks are therefore advised to ensure that
full address / telephone number of the branch is invariably mentioned in the
passbooks / statement of accounts issued to account holders.
Printing of MICR code
and IFSC code on passbook / statement of account
Banks are advised to provide
MICR code, IFCS code in all passbook / statement of account of their account
holders.
Issue of Cheque Books
Issuing
large number of cheque books (issued to Public Sector Banks)
Banks may issue cheque books with larger
number of (20/25) leaves if a customer demands the same.
Banks should take appropriate care while
issuing large number of cheque books. It should be done in consultation with
the Controlling Office of the bank.
Writing the cheques
in any language
All cheque forms should be printed in Hindi
and English. The customer may, however, write cheques in Hindi, English or in
the concerned regional language.
Dispatching the
cheque book by courier
Banks should refrain from obtaining such
undertakings from depositors that a dispatch by the courier is at depositor's
risk and ensure that cheque books are delivered over the counters on request to
the depositors or his authorized representative.
Acceptance
of cheques bearing a date as per National Calendar (Saka Samvat) for payment
An instrument written
in Hindi having date as per Saka Samvat calendar is a valid instrument. Banks
can ascertain the Gregorian calendar date corresponding to the National Saka
calendar in order to avoid payment of stale cheques.
Issue of Multicity /
Payable at All Branches Cheques by CBS enabled Banks:
Banks have been advised not to charge their
savings bank account customers for issuance of CTS-2010 standard cheques when
they are issued for the first time.
Term Deposit Account
Issue of term deposit
receipt
Bank should issue term deposit receipt
indicating therein full details, such as, date of issue, period of deposit, due
date, applicable rate of interest, etc.
Transferability of
deposit receipts
Term deposits should
be freely transferable from one office of bank to another.
Disposal of deposits
Advance instructions from depositors for
disposal of deposits on maturity may be obtained in the application form
itself. Wherever such instructions are not obtained, banks should ensure
sending of intimation of impending due date of maturity well in advance to
their depositors as a rule in order to extend better customer service.
Notifying the change in interest rates
Change
in interest rate on deposits should be made known to customers as well as bank
branches expeditiously.
Payment
of interest on fixed deposit – Method of calculation of interest
IBA, has prescribed that on deposits
repayable in less than three months or where the terminal quarter is
incomplete, interest should be paid proportionately for the actual number of
days reckoning the year at 365 days. Some banks are adopting the method of
reckoning the year at 366 days in a Leap year and 365 days in other years. They
should provide information to their depositors about the manner of calculation
of interest appropriately while accepting the deposits and display the same at
their branches.
Premature withdrawal
of term deposit
A bank, on request from the depositor, should
allow withdrawal of a term deposit before completion of the period of the
deposit.
The bank will have the freedom to determine
its own penal interest rate of premature withdrawal.
Interest on the deposit for the period that
it has remained with the bank will be paid at the rate applicable to the period
for which the deposit remained with the bank and not at the contracted rate.
No interest is payable, where premature
withdrawal of deposits takes place before completion of the minimum period
prescribed.
With effect from April 1, 2013 banks will
have the discretion to disallow premature withdrawal of a term deposit in
respect of bulk deposits of
1
crore and above.
Bank should ensure that the depositors are
made aware of the applicable penal rates along with the deposit rates. The
revised guidelines are made applicable with effect from April 1, 2013.
Repayment of
Term/Fixed Deposits in banks:
1. It is clarified that
if fixed/term deposit accounts are opened with operating instructions ‘Either
or Survivor’, the signatures of both the depositors need not be obtained for
payment of the amount of the deposits on maturity. However, the signatures of
both the depositors may have to be obtained, in case the deposit is to be paid
before maturity. If the operating instruction is ‘Either or Survivor’ and one
of the depositors expires before the maturity, no pre-payment of the fixed/term
deposit may be allowed without the concurrence of the legal heirs of the
deceased joint holder. This, however, would not stand in the way of making
payment to the survivor on maturity.
2. In case the mandate
is ‘Former or Survivor’, the ‘Former’ alone can operate/withdraw the matured
amount of the fixed/term deposit, when both the depositors are alive. However,
the signature of both the depositors may have to be obtained, in case the
deposit is to be paid before maturity. If the former expires before the
maturity of the fixed/term deposit, the ‘Survivor’ can withdraw the deposit on
maturity. Premature withdrawal would however require the consent of both the
parties, when both of them are alive, and that of the surviving depositor and
the legal heirs of the deceased in case of death of one of the depositors.
3. In case of term
deposits with "Either or Survivor" or "Former or Survivor"
mandate, banks are permitted to allow premature withdrawal of the deposit by
the surviving joint depositor on the death of the other, only if, there is a
joint mandate from the joint depositors to this effect.
4. The joint deposit
holders may be permitted to give the mandate either at the time of placing
fixed deposit or anytime subsequently during the term / tenure of the deposit.
If such a mandate is obtained, banks can allow premature withdrawal of term /
fixed deposits by the surviving depositor without seeking the concurrence of
the legal heirs of the deceased joint deposit holder. It is also reiterated
that such premature withdrawal would not attract any penal charge.
5. When a fixed deposit
account is opened in the joint names of two depositors on ‘Either or Survivor’
basis and the said joint depositors already have a savings bank account in
their names jointly on ‘Either or Survivor’ instructions, on maturity of the
fixed deposit, proceeds of the matured fixed deposit can be credited to the
joint savings bank account already opened in the bank.
6. Renewal of Overdue
deposits
All aspects concerning renewal of overdue
deposits may be decided by individual banks subject to their Board laying down
a transparent policy in this regard and the customers being notified of the
terms and conditions of renewal including interest rates, at the time of
acceptance of deposit. The policy should be non-discretionary and
non-discriminatory.
Addition or deletion
of the name/s of joint account holders
A bank may, at the request of all the joint
account holders, allow the addition or deletion of name/s of joint account
holder/s if the circumstances so warrant or allow an individual depositor to
add the name of another person as a joint account holder. However, in no case
should the amount or duration of the original deposit undergo a change in any
manner in case the deposit is a term deposit.
A bank may, at its discretion, and at the
request of all the joint account holders of a deposit receipt, allow the
splitting up of the joint deposit, in the name of each of the joint account
holders only, provided that the period and the aggregate amount of the deposit
do not undergo any change.
Note: NRE deposits should be held jointly
with non-residents only. NRO accounts may be held by non-residents
jointly with residents.
Payment of interest
on accounts frozen by banks
Banks are advised to follow the procedure
detailed below in the case of Term Deposit Accounts frozen by the enforcement
authorities:
(i) A request letter may be obtained from the
customer on maturity. While obtaining the request letter from the depositor for
renewal, banks should also advise him to indicate the term for which the
deposit is to be renewed. In case the depositor does not exercise his option of
choosing the term for renewal, banks may renew the same for a term equal to the
original term.
(ii)
No
new receipt is required to be issued. However, suitable note may be made
regarding renewal in the deposit ledger.
(iii)
Renewal
of deposit may be advised by registered letter / speed post / courier service
to the concerned Government department under advice to the depositor. In the
advice to the depositor, the rate of interest at which the deposit is renewed
should also be mentioned.
(iv)
If
overdue period does not exceed 14 days on the date of receipt of the request
letter, renewal may be done from the date of maturity. If it exceeds 14 days,
banks may pay interest for the overdue period as per the policy adopted by
them, and keep it in a separate interest free sub-account which should be
released when the original fixed deposit is released.
Further, with regard to the savings bank
accounts frozen by the Enforcement authorities, banks may continue to credit
the interest to the account on a regular basis.
Acknowledgement by
banks at the time of submission of Form 15-G / 15-H
Banks are advised to give an acknowledgment
at the time of receipt of Form15-G/15-H.
Banks are advised to provide TDS Certificate
in Form 16A, to their customers in respect of whom they (banks) have deducted
tax at source.
Acceptance of cash
over the counter
Banks are, therefore, advised to ensure that
their branches invariably accept cash over the counters from all
their customers who desire to deposit cash at the counters. Further, they
are also advised to refrain from incorporating clauses in the terms and
conditions which restrict deposit of cash over the counters.
Opening accounts in
the name of minors with Mothers as guardians
Banks are advised to instruct their branches
to allow minors' accounts (recurring, fixed and savings only) with mothers as
guardians to be opened.
Opening of Bank
Accounts in the Names of Minors
With a view to promote the objective of
financial inclusion and also to bring uniformity among banks in opening and
operating minors’ accounts, banks are advised as under:
- A
savings /fixed / recurring bank deposit account can be opened by a minor
of any age through his/her natural or legally appointed guardian.
- Minors
above the age of 10 years may be allowed to open and operate savings bank
accounts independently, if they so desire. Banks may, however, keeping in
view their risk management systems, fix limits in terms of age and amount
up to which minors may be allowed to operate the deposit accounts
independently. They can also decide, in their own
discretion, as to what minimum documents are required for opening of
accounts by minors.
c. On attaining
majority, the erstwhile minor should confirm the balance in his/her account and
if the account is operated by the natural guardian / legal guardian, fresh
operating instructions and specimen signature of erstwhile minor should be
obtained and kept on record for all operational purposes.
Banks are free to offer additional banking
facilities like internet banking, ATM/ debit card, cheque book facility etc.,
subject to the safeguards that minor accounts are not allowed to be overdrawn
and that these always remain in credit.
Opening of Current Accounts
– Need for discipline
(i)
Banks
should scrupulously ensure that their branches do not open current accounts of
entities which enjoy credit facilities (fund based or non-fund based) from the
banking system without specifically obtaining a No-Objection Certificate from
the lending bank(s). Banks should note that non-adherence to the above
discipline could be perceived to be abetting the siphoning of funds and such
violations which are either reported to RBI or noticed during our inspection
would make the concerned banks liable for penalty under Banking Regulation Act,
1949.
(ii)
Banks
may open current accounts of prospective customers in case no response is
received from the existing bankers after a minimum waiting period of a
fortnight. If a response is received within a fortnight, banks should assess
the situation with reference to information provided on the prospective
customer by the bank concerned and are not required to solicit a formal no
objection, consistent with true freedom to the customer of banks as well as
needed due diligence on the customer by the bank.
(iii) In case of a
prospective customer who is a corporate or large borrower enjoying credit
facilities from more than one bank, the banks should exercise due diligence and
inform the consortium leader, if under consortium, and the
concerned banks, if under multiple banking arrangement.
Reconciliation of transactions at ATMs
failure - Time limit
- Failure
to recredit the customer’s account within 7 working days of receipt of the
complaint shall entail payment of compensation to the customer @Rs.100/-
per day by the issuing bank. This compensation shall be credited to the
customer’s account automatically without any claim from the customer, on
the same day when the bank affords the credit for the failed ATM
transaction.
- Any
customer is entitled to receive such compensation for delay, only if a
claim is lodged with the issuing bank within 30 days of the date of the
transaction.
- The
number of free transactions permitted per month at other bank ATMs to
Savings Bank account holders shall be inclusive of all types of
transactions, financial or non-financial.
- All
disputes regarding ATM failed transactions shall be settled by the issuing
bank and the acquiring bank through the ATM System Provider only.
No bilateral settlement arrangement outside the dispute resolution
mechanism available with the system provider is permissible. This measure
is intended to bring down the instances of disputes in
payment of compensation between the issuing and acquiring banks.
Non-adherence
to the provisions contained in para 5.12 (a) to (d) shall attract penalty as
prescribed under the Payment and Settlement Systems Act 2007 (Act 51 of 2007).
Lodging of ATM related Complaints
The following
information should be displayed prominently at the ATM locations:-
(i)
ATM
ID may be displayed clearly in the premises to make use of it while making a
complaint / suggestion
(ii)
Information
that complaints should be lodged at the branches where customers maintain
accounts to which ATM card is linked
(iii)
Telephone
numbers of help desk / contact persons of the ATM owning bank to lodge
complaint / seek assistance
(iv)
Uniform
Template (as given in Annexure V) for lodging of complaints relating to ATM
transactions.
To
improve the customer service through enhancement of efficiency in ATM
operations, banks are advised to initiate following action:
(i) Message regarding
non-availability of cash in ATMs should be displayed before the transaction is
initiated by customer
(ii) Make available forms
for lodging the complaints with name and phone number of the officials with
whom they have to be lodged
(iii) Make available
sufficient toll-free phone numbers for lodging complaints / reporting and
blocking lost cards and also attend the requests on priority
(iv) Mobile numbers / e-mail
IDs of the customers may be registered to send alerts
In case of complaints pertaining to a failed
ATM transaction at other bank ATMs, the customer should lodge a complaint with
the card issuing bank even if the transaction was carried out at another bank’s
ATM.
Transactions
at ATM-Procedural Amendment - Pin Validation for Every Successive Transaction
Each bank may ensure that the process flow is
modified to provide for the pin validation for every transaction, including
balance enquiry facilitated through ATM. Further, as an additional safety
measure, banks are advised that the time-out of sessions should be enabled for
all screens / stages of ATM transaction keeping in view the time required for
such functions in normal course.
Non-adherence to the above provisions shall
attract penalty as prescribed under the Payment and Settlement Systems Act.
Security
Issues and Risk mitigation measures- Online alerts to the cardholder for usage
of credit/debit cards
Banks were advised to put in place, latest by
June 30, 2011, a system of online alerts for all types of transactions
irrespective of the amount, involving usage of cards at various channels. Banks
should provide easier methods (like SMS) for the customer to block his card and
get a confirmation to that effect after blocking the card.
Security Issues and Risk mitigation measures
related to Card Not Present (CNP) transactions
Banks have been
mandated to necessarily put in place additional factor of
authentication/validation based on information not visible on the cards for all
on-line
Card not Present (CNP) transactions in a
phased manner, starting with online transactions followed by Interactive Voice
Response (IVR), Mail Order Telephone Order (MOTO) and Standing Instructions
(SI). In the case of MOTO and SI transactions, it has been stated that in case
of customer complaint regarding issues, if any, arising out of transactions
effected without the additional factor of authentication after the stipulated
date, the issuer bank has to reimburse the loss to the customer further without
demur.
Securing Electronic
Payment Transactions
Some of the additional measures that need to
be introduced by the banks could be as follows:
(i)
Customer
induced options may be provided for fixing a cap on the value / mode of
transactions / beneficiaries. In the event of customer wanting to exceed the
cap, an additional authorization may be insisted upon.
(ii)
Limit
on the number of beneficiaries that may be added in a day per account could be
considered.
(iii) A system of alert may
be introduced when a beneficiary is added.
(iv)
Banks
may put in place mechanism for velocity check on the number of transactions
effected per day / per beneficiary and any suspicious operations should be
subjected to alert within the bank and to the customer.
(v)
Introduction
of additional factor of authentication (preferably dynamic in nature) for such
payment transactions should be considered.
(vi)
The
banks may consider implementation of digital signature for large value payments
for all customers, to start with for RTGS transactions.
(vii) Capturing of Internet Protocol (IP)
address as an additional validation check should be considered.
Levy of Service
Charges
Fixing service
charges by banks
Banks should make
arrangements for working out charges with prior approval of their Boards of
Directors as recommended above and operationalise them in their branches as
early as possible.
Ensuring Reasonableness of Bank Charges
In order to ensure fair practices in banking
services, Reserve Bank of India had constituted a Working Group to formulate a
scheme for ensuring reasonableness of bank charges and to incorporate the same in
the Fair Practices Code, the compliance of which would be monitored by the
Banking Codes and Standards Board of India (BCSBI). Based on the
recommendations of the Group, action required to be taken by banks is indicated
under the column 'action points for banks' in the Annex I to this
circular.
Home Loans-Levy of
fore-closure charges/pre-payment penalty
The Committee on Customer Service in Banks
(Chairman: M. Damodaran) had observed that foreclosure charges levied by
banks on prepayment of home loans are resented upon by home loan borrowers
across the board especially since banks were found to be hesitant in passing on
the benefits of lower interest rates to the existing borrowers in a falling
interest rate scenario. As such, foreclosure charges are seen as a restrictive
practice deterring the borrowers from switching over to cheaper available
source.
It has been decided
that banks will not be permitted to charge foreclosure charges/pre-payment
penalties on home loans on floating interest rate basis, with immediate effect.
As per extant guidelines a fixed rate loan is
one where the rate is fixed for entire duration of the loan. Hence, the Dual
Rate/Special Rate home loans sanctioned by banks cannot be treated as fixed
rate loans. In case of Dual Rate/ Special Rate home loans, the provisions of
paragraph 6.3.1 above will be applicable from the date the rate of interest on
the loan becomes floating.
Levy of Foreclosure Charges / Pre-payment
Penalty on Floating Rate Term Loans
Banks will not be permitted to charge
foreclosure charges / pre-payment penalties on all floating rate term loans
sanctioned to individual borrowers.
RTGS charges for
customers
Consequent to the levy of service charges for
members under RTGS, banks cannot charge their customers for outward RTGS
remittances beyond the amounts stipulated below:
Inward
Transactions: Free
Outward
transactions: 25 + applicable time varying tariff
2 lakh to 5 lakh: subject to a maximum of 30 `
Above 5 lakh: 50 + applicable time varying tariff
subject to a maximum of 55
`
Uniformity in
Intersol Charges
Banks are advised to follow a uniform, fair
and transparent pricing policy and not discriminate between their customers at
home branch and non-home branches. Accordingly, if a particular service is
provided free at home branch, the same should be available free at non home
branches also. There should be no discrimination as regards intersol charges
between similar transactions done by customers at home branch and those done at
non-home branches.
Charges for Sending
SMS Alerts
Banks are advised to leverage the technology
available with them and the telecom service providers to ensure that such
charges are levied on all customers on actual usage basis.
Service at the
counters
Banks should normally function for public
transactions at least for 4 hours on week days and 2 hours on Saturdays.
Extension counters, Satellite Offices, one man offices or other special class
of branches may remain open for such shorter hours as may be considered
necessary.
Changes in banking
hours
No particular banking hours have been prescribed
by law and a bank may fix, after due notice to its customers.
In order to safeguard banks' own interest, a
bank closing any of its offices on a day other than a public holiday, will have
to give due and sufficient notice to all the parties concerned. What is
sufficient or due notice is a question of fact, depending on the circumstances
of each case. It is also necessary to avoid any infringement of any other
relevant local laws such as Shops and Establishment Act, etc.
Further, the provisions, if any, in regard to
the banks' obligations, to the staff under the Industrial Awards / Settlements,
should be complied with. Clearing House authority of the place should also be
consulted in this regard.
The banks' branches in rural areas can fix
the business hours (i.e. number of hours, as well as timings) and the weekly
holidays to suit local requirements. This may, however, be done subject to the
guidelines given above.
Commencement /
Extension of working hours
Commencement of employees’ working hours 15
minutes before commencement of business hours could be made operative by banks
at branches in metropolitan and urban centers. The banks
should implement the recommendation taking into account the provisions of the
local Shops and Establishments Act.
The branch managers and other supervising
officials should, however, ensure that the members of the staff are available
at their respective counters right from the commencement of banking hours.
Banks should ensure that no counter remains
unattended during the business hours and uninterrupted service is rendered to
the customers.
All the customers entering the banking hall
before the close of business hours should be attended to.
Extended business
hours for non-cash banking transactions
Banks should extend business hours for
banking transactions other than cash, up till one hour before close of the
working hours.
The following non-cash transactions should be
undertaken by banks during the extended hours, i.e., up to one hour before the
close of working hours:
(a)
Non-voucher generating transactions :
(i)
Issue
of pass books/statement of accounts;
(ii)
Issue
of cheque books ;
(iii)
Delivery
of term deposit receipts/drafts;
(i)
Acceptance
of share application forms;
(ii)
Acceptance
of clearing cheques;
(iii)
Acceptance
of bills for collection.
(b)
Voucher generating transactions:
(i)
Issue
of term deposit receipts;
(ii)
Acceptance
of cheques for locker rent due;
(iii)
Issue
of travelers cheques;
(v)
Acceptance
of individual cheques for transfer credit.
Such non-cash transactions to be done during
the extended business hours should be notified adequately for information of
the customers.
Banks can have evening counters at the
premises of existing branches in urban/metropolitan centers for providing
facilities to the public beyond the normal hours of business so as to bring
about improvement in customer service. It is necessary that in such cases the
transactions conducted during such extended hours of business are merged with
the main accounts of the branch where it is decided to provide the aforesaid
facilities.
The concerned banks should give to their
constituents due notice about the functions to be undertaken during the
extended banking hours through local newspapers, as also by displaying a notice
on the notice board at the branch concerned. Further, as and when the hours of
business of any of the branches are extended, the concerned clearing house
should be informed.
Guidance to customers
and Disclosure of Information
Assistance/guidance
to customers
All branches, except very small branches
should have “Enquiry” or “May I Help You” counters either exclusively or
combined with other duties, located near the entry point of the banking hall.
Display of time norms
Time norms for specialised business transactions
should be displayed predominantly in the banking hall.
Display
of information by banks – Comprehensive Notice Board
The display of information by banks in their
branches is one of the modes of imparting financial education.
Keeping in view the need for maintaining a
good ambience at the branches as also space constraints, an Internal Working
Group in RBI revisited all the existing instructions relating to display boards
by commercial banks so as to rationalize them. Based on the recommendations of the
Working Group, the following instructions were issued to banks:
Notice Boards
The Group felt that rationalization of the
existing instructions could be best achieved if the instructions were clubbed
on certain categories such as ‘customer service information', 'service
charges', 'grievance redressal' and 'others'. Accordingly, the existing
mandatory instructions have been broadly grouped into four categories mentioned
above and given in a Comprehensive Notice Board which has been
formulated by the above Group. The minimum size of the Board may be 2 feet by 2
feet as Board of such a size would facilitate comfortable viewing from a
distance of 3 to 5 meters. Banks are advised to display the information in
the Notice Boards of their Branches as per the format given for the
Comprehensive Notice Board.
While
displaying the information in the notice board, banks may also adhere to the
following principles:
(a)
The
notice board may be updated on a periodical basis and the board should indicate
the date up to which the board was updated (incorporated in the display board)
(b) Though the pattern, colour and design
of the board is left to the discretion of the banks, yet the display must be
simple and readable.
(c)
The
language requirements (i.e., bilingual in Hindi speaking states and trilingual
in other states) may be taken into account.
(d)
The
notice board shall specifically indicate wherever recent changes have been
done. For instance, if there is a recent change in the SSI loan products
offered by the bank, the information on the SSI loan products may be displayed
as 'We offer SSI loans/products ( changed on ……….)’.
(e)
The
notice board may also indicate a list of items on which detailed information is
available in booklet form.
Further, in addition to the above Board, the
banks should also display details such as ‘Name of the bank / branch, Working
Days, Working Hours and Weekly Off-days' outside the branch premises.
Booklets/Brochures:
The detailed information as indicated in Para
(E) of Annex II may be made available in various booklets / brochures as
decided by the bank. These booklets / brochures may be kept in a separate file
/ folder in the form of ‘replaceable pages’ so as to facilitate copying and
updation. In this connection, banks may also adhere to the following broad
guidelines:
v
The
file / folder may be kept at the customer lobby in the branch or at the ‘May I
Help You’ counter or at a place that is frequented by most of the customers.
v
The
language requirements (i.e. bilingual in Hindi speaking states and trilingual
in other states) may be taken into account.
v
While
printing the booklets it may be ensured that the font size is minimum Arial 10
so that the customers are able to easily read the same.
Website
The detailed information as indicated in Para
(E) of Annex II may also be made available on the bank’s web-site. Banks should
adhere to the broad guidelines relating to dating of material, legibility,
etc., while placing the same on their websites. In this context, banks are also
advised to ensure that the customers are able to easily access the relevant
information from the Home Page of the bank’s web-sites. Further, there
are certain information relating to service charges and fee and grievance
redressal that are to be posted compulsorily on the websites of the bank.
Reserve Bank is providing a link to the websites of banks so that customers can
also have access to the information through RBI’s website.
Other modes of
display
Banks may also consider displaying all the
information that has to be given in the booklet form in the touch screen by
placing them in the information kiosks. Scroll Bars, Tag Boards are other
options available. The above broad guidelines may be adhered to while
displaying information using these modes.
Other issues
Banks are free to decide on their promotional
and product information displays. However, the mandatory displays may not be
obstructed in anyway. As customer interest and financial education are sought
to be achieved by the mandatory display requirements, they should also be given
priority over the other display boards. Information relating to Government
sponsored schemes as applicable location-wise may be displayed according to
their applicability.
A format has been devised by Reserve Bank for
display of information relating to interest rates and service charges which
would enable the customer to obtain the desired information at a quick glance.
The format is given in Annex III. Banks are advised to display the
information as per the format given in Annex III on their web-sites. Banks are
however free to modify the format to suit their requirements, without impairing
the basic structure or curtailing the scope of disclosures.
Banks may also ensure that only latest
updated information in the above format is placed on their web-sites and the
same is easily accessible from the Home Page of their web-sites.
Display of
information by banks
In order to enhance transparency in pricing
of credit, based on the recommendations of Working Group on Pricing of Credit,
banks are advised to adhere to the following additional instructions with
effect from April 1, 2015:
(a)
Website:
i.
Banks
should display on their website the interest rate range of contracted loans for
the past quarter for different categories of advances granted to individual
borrowers along with mean interest rates for such loans.
ii.
The
total fees and charges applicable on various types of loans to individual
borrower should be disclosed at the time of processing of loan as well as
displayed on the website of banks for transparency and comparability and to
facilitate informed decision making by customers.
iii.
Banks
should publish Annual Percentage Rate (APR) or such similar other arrangement
of representing the total cost of credit on a loan to an individual borrower on
their websites so as to allow customers to compare the costs associated with
borrowing across products and/ or lenders.
(b)
Key
Statement/ Fact Sheet:
Banks
should provide a clear, concise, one page key fact statement/fact sheet, as per
prescribed format in Annex IX, to all individual borrowers at every stage of
the loan processing as well as in case of any change in any
terms and conditions. The same may also be included as a summary box to be
displayed in the credit agreement.
Disclosure of
Information by banks in the public domain
Disclosure of information on products and
services on websites is found to be an effective channel for reaching out to
customers and the public at large. Such disclosures increase transparency in
operations and also help to create awareness among customers about the products
and services offered by banks. Some of the details, which could be made
available for public viewing through websites of the bank, are listed below:-
I.
Policy / Guidelines
(i)
Citizen's
Charter
(ii)
Deposit
Policy
(iii)
Deceased
Depositors Policy along with Nomination Rules
(iv)
Cheque
Collection Policy
(v)
Fair
Practices Code for Lenders
(vi)
Fair
Practices Code for Self- Regulation of Credit Card
Business
(vii)
Code
of Conduct for Direct Selling Agents
(viii)
Code
for Collection of Dues and Repossession of Security
II.
Complaints
(i)
Grievance
Redressal Mechanism
(ii)
Information
relating to Banking Ombudsmen
(iii)
Information
relating to Customer Service Centres (for Public Sector Banks)
III. Opening of Accounts
(i)
Account
Opening Forms
(ii)
Terms
and Conditions
(iii)
Service
Charges for various types of services – Should cover typical common services
including courier charges – What services are available without any charges.
(iv)
Interest
rates on Deposits
(v)
Minimum
balances – along with corresponding facilities offered.
IV. Loans and
Advances
(i) Application forms
relating to loans and advances
(ii) Copy of blank
agreement to be executed by the borrower
(iii) Terms and Conditions
(iv) Processing fee and
other charges
(v) Interest rates on
Loans and Advances
V. Branches
(i)
Details
of branches along with addresses and telephone numbers (with search engine for
queries relating to branch location)
(ii) Details of ATMs along
with addresses
Display of Timelines
for Credit Decisions
Banks should clearly delineate the procedure
for disposal of loan proposals, with appropriate timelines, and institute a
suitable monitoring mechanism for reviewing applications pending beyond the
specified period. There should not, however, be any compromise on due diligence
requirements. Banks may also make suitable disclosures on the timelines for
conveying credit decisions through their websites, notice-boards, product
literature, etc.
Operation of Accounts
by Old & Incapacitated Persons
Facility to
sick/old/incapacitated non-pension account holders
The facilities offered to pension account
holders should be extended to the non-pension account holders also who are sick
/ old / incapacitated and are not willing to open and operate joint accounts.
Types of sick / old /
incapacitated account holders
The cases of sick /
old / incapacitated account holders fall into following categories:
(a)
An
account holder who is too ill to sign a cheque / cannot be physically present
in the bank to withdraw money from his bank account but can put his/her thumb
impression on the cheque/withdrawal form;
(b)
Account
holders who are not only unable to be physically present in the bank but are
also not able to put his/her thumb impression on the cheque/withdrawal form due
to certain physical incapacity.
Operational Procedure
With
a view to enabling the old / sick account holders operate their bank accounts,
banks may follow the procedure as under:-
(a)
Wherever
thumb or toe impression of the sick/old/incapacitated account holder is
obtained, it should be identified by two independent witnesses known to the
bank, one of whom should be a responsible bank official.
(b)
Where
the customer cannot even put his / her thumb impression and also would not be
able to be physically present in the bank, a mark can be obtained on the cheque
/ withdrawal form which should be identified by two independent witnesses, one
of whom should be a responsible bank official.
(c)
The
customer may also be asked to indicate to the bank as to who would withdraw the
amount from the bank on the basis of cheque / withdrawal form as obtained above
and that person should be identified by two independent witnesses. The person
who would be actually drawing the money from the bank should be asked to
furnish his signature to the bank.
Opinion of IBA in case of a person who cannot
sign due to loss of both hands
Opinion obtained by the Indian Banks’
Association from their consultant on the question of opening of a bank account
of a person who has lost both his hands and could not sign the cheque /
withdrawal form is as under:
The Supreme Court has
held in AIR 1950 – Supreme Court, 265 that there must be physical contact
between the person who is to sign and the signature can be by means of a mark.
This mark can be placed by the person in any manner. It could be the toe
impression, as suggested. It can be by means of mark which anybody can put on
behalf of the person who has to sign, the mark being put by an instrument which
has had a physical contact with the person who has to sign”.
Providing bank
facilities to persons with disabilities
Guidelines
framed by IBA based on the judgment of Chief Commissioner for Persons with
Disabilities
Indian Banks' Association has framed
operational guidelines for implementation of its member banks on providing
banking facilities to persons with disabilities. Banks should adopt / follow
the operational guidelines meticulously.
Need
for Bank Branches / ATMs to be made accessible to persons with disabilities
Banks are advised to take necessary steps to
provide all existing ATMs / future ATMs with ramps so that wheel
chair users / persons with disabilities can easily access them. Care may
also be taken to make arrangements in such a way that the height of the ATMs
does not create an impediment in their use by wheelchair users. However, in
cases where it is impracticable to provide such ramp facilities, whether
permanently fixed to earth or otherwise, this requirement may be dispensed
with, for reasons recorded and displayed in branches or ATMs concerned.
Banks are also to take appropriate steps,
including providing of ramps at the entrance of the bank branches, wherever
feasible, so that the persons with disabilities/wheel chair users can enter
bank branches and conduct business without difficulty. Banks are advised to
report the progress made in this regard periodically to their respective
Customer Service
Committee of the Board and ensure compliance.
Banks should therefore ensure that all the
banking facilities such as cheque book facility including third party cheques,
ATM facility, Net banking facility, locker facility, retail loans, credit cards
etc., are invariably offered to the visually challenged without any
discrimination.
Talking
ATMs with Braille keypads to facilitate use by persons with visual impairment
Banks should make all new ATMs installed from
July 1, 2014 as talking ATMs with Braille keypads. Banks should lay down a road
map for converting all existing ATMs as talking ATMs with Braille keypads and
the same may be reviewed from time to time by the Customer Service Committee of
the Board.
In addition to the above, magnifying glasses
should also be provided in all bank branches for the use of persons with low
vision, wherever they require for carrying out banking transactions with ease.
The branches should display at a prominent place notice
about the availability of magnifying glasses and other facilities available for
persons with disabilities.
Guidelines for the purpose of opening/
operating bank accounts of Persons with Autism, Cerebral Palsy, Mental
Retardation, Mental Illness and Mental Disabilities
The following guidelines would be applicable
for the purpose of opening / operating bank accounts of the above persons:
i.
The
Mental Health Act, 1987 provides a law relating to the treatment and care of
mentally ill persons and to make better provision with respect to their
property and affairs. According to the said Act, “mentally ill person” means a
person who is in need of treatment by reason of any mental disorder other than
mental retardation. Sections 53 and 54 of this Act provide for the appointment
of guardians for mentally ill persons and in certain cases, managers in respect
of their property. The prescribed appointing authorities are the district
courts and collectors of districts under the Mental Health Act, 1987.
ii.
The
National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental
Retardation and Multiple Disabilities Act, 1999 provides a law relating to
certain specified disabilities. Clause (j) of Section 2 of that Act defines a
“person with disability” to mean a person suffering from any of the conditions
relating to autism, cerebral palsy, mental retardation or a combination of any
two or more of such conditions and includes a person suffering from severe
multiple disabilities. This Act empowers a Local Level Committee to appoint a
guardian, to a person with disabilities, who shall have the care of the person
and property of the disabled person.
iii.
Banks
are advised to take note of the legal position stated above and may rely on and
be guided by the orders/certificates issued by the competent authority, under
the respective Acts, appointing guardians/managers for the purposes of
opening/operating bank accounts. In case of doubt, care may be taken to obtain
proper legal advice.
Banks may also ensure that their branches
give proper guidance to their customers so that the guardians/managers of the
disabled persons do not face any difficulties in this regard.
Display
of information regarding Local Level Committees set up under the National Trust
for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and
Multiple Disabilities Act, 1999
In a case which came up before the High Court
of Delhi, the Honorable Court had directed that all banks should ensure that
their branches display in a conspicuous place
(i) Essential details about the facilities
under the enactment (Mental Disabilities Act); (ii) the fact that the parties
can approach the Local Level Committees, for the purpose of issuance of the
certificate and that the certificate issued under the Mental Disabilities
Act is acceptable; and (iii) the details of
the Local Level Committees in that area. The Court had further directed that
the information shall be displayed in the local language and English / Hindi
(or both). Banks are advised to strictly comply with the above orders of the
Court.
Remittance
Remittance of Funds
for Value `
50,000/- and above
Banks should ensure that any remittance of
funds by way of demand drafts/mail transfers / telegraphic transfers or any
other mode and issue of travelers cheques for value of ₹ 50,000 /- and above is
effected only by debit to the customer’s account or against cheques or other
instruments tendered by the purchaser and not against cash payment . These
instructions are extended to retail sale of gold/silver/platinum. In the
current scenario, where the integrity of the financial system in general and
the banking channels in particular is of paramount importance, breach of these
guidelines is a matter of serious regulatory concern in view of the wide
ranging ramifications. Any violation of these instructions will be viewed
seriously.
Demand Drafts
Measures seeking to bring down the incidence
of frauds perpetrated through bank drafts should be built into the draft form
itself. Necessary changes in system and procedures to speed up issue and
payment of drafts should be taken.
Banks should ensure that demand drafts of `
20,000/- and above are issued invariably with account payee crossing.
All superscriptions about validity of the
demand draft should be provided at the top of the draft form. A draft should be
uniformly valid for a period of three months and procedure for revalidation
after three months should be simplified.
Banks should ensure that drafts of small amounts
are issued by their branches against cash to all customers irrespective of the
fact whether they are having accounts with the banks or not. Bank's counter
staff should not refuse to accept small denomination notes from the customers
(or non customers for issuance of the drafts).
Encashment of drafts
The banks should
ensure that drafts drawn on their branches are paid immediately.
Payment of draft should not be refused for
the only reason that relative advice has not been received.
Issue of Duplicate
Demand Draft
Duplicate draft, in lieu of lost draft, up
to and including ` 5,000/- may be issued to the purchaser on the basis of
adequate indemnity and without insistence on seeking nonpayment advice from
drawee office irrespective of the legal position obtaining in this regard.
Banks should issue duplicate Demand Draft
to the customer within a fortnight from the receipt of such request.
Further, for the delay beyond this stipulated period, banks were advised to pay
interest at the rate applicable for fixed deposit of corresponding maturity in
order to compensate the customer for such delay. The period of fortnight
prescribed would be applicable only in cases where the request for duplicate
demand draft is made by the purchaser or the beneficiary and would not be
applicable in the case of third party endorsements.
Remittance through
electronic mode
In case of remittance through electronic
funds transfer, originating banks should provide the option to the customer to
choose between RTGS system and NEFT system at the time of initiation of the
funds transfer. The option should be made available to all the customers who
may originate remittance either at the branch or through internet or any other
means. The funds are to be transferred necessarily through the option chosen by
the customer. Further, banks should allow the customers to choose NEFT also as
one of the electronic modes of making payment towards loan EMIs / repayments,
etc.
Providing Positive
Confirmation to the Originator
All banks should put in place appropriate
mechanism to ensure positive confirmation is sent to the remittance originator
confirming the successful credit of funds to the beneficiary’s account when
funds are transferred through NEFT. While it is expected that such confirmation
messages are sent as soon as the beneficiary account is credited, it should not
exceed beyond end-of –the-day under any circumstance.
Payment of penal
interest for delayed credit /refunds of NEFT transactions
In case of delay in crediting the beneficiary
customer’s account or in returning the uncredited amount to the remitter in
case of NEFT, banks should pay penal interest. Under the extant guidelines,
banks are required to pay penal interest at the current RBI LAF Repo Rate
plus two percent for the period of delay / till the date of refund as the
case may be to the affected customers’ suo moto, without waiting for claim from
customers.
Under the NEFT Procedural Guidelines, banks
are required to establish dedicated Customer Facilitation Centres (CFCs) to handle
customer queries/complaints regarding NEFT transactions. The contact details of
CFCs are available on websites of banks as well as the website of RBI for easy
availability to the customers. Further, banks have to keep the contact details
of their CFCs, set up to handle customer queries / complaints regarding NEFT
transactions, updated at all times. Changes, if any, should be advised by banks
immediately to the National Clearing Cell, Nariman Point, RBI for updating the
central directory placed on RBI website. Banks should also ensure that calls
made / e-mails sent to CFCs are promptly attended to and sufficient resources
are dedicated for the same.
National / Regional Electronic Clearing
Service (NECS / RECS) – Extension of service to remaining branches
With a view to extend both NECS and RECS
facility to the customers of all bank branches, the participating banks are
advised to make efforts in bringing all their branches under NECS/RECS.
National Electronic Funds Transfer (NEFT) –
Requirement of Indian Financial System Code (IFSC) in transactions
To facilitate electronic modes of remittance
and enhancing customer service at branches for NEFT transactions, the
participating banks are advised that staff should provide customers with
necessary assistance in filling out the details as required in the NEFT
application form, including ensuring that beneficiary account details etc. are
duly filled in.
National Electronic Funds Transfer (NEFT)
System - Rationalisation of customer charges
Maximum
Customer charges that can be levied by the banks for NEFT transactions are as
under:
Value Band
|
Maximum Charges
|
(exclusive of service tax)
|
|
Amounts up to
|
` 2.50/-
|
`10,000/-
|
|
Amounts from `
|
` 5/-
|
10,001/- to ` 1 lakh
|
|
Amounts above ` 1
|
` 15/-
|
lakh up to ` 2 lakh
|
|
Amounts above ` 2
|
` 25/-
|
lakh
|
NEFT - Customer Service and Charges -
Adherence to Procedural Guidelines and Circulars
With a view to minimizing instances of
customer complaints, all participant banks (both direct as well as
sub-members), are advised to ensure adherence to extant instructions as under:
• NEFT application
forms with proper instructions are made available at all branches.
• The charges levied on
customers for inter-bank NEFT transactions at both branch locations and
Customer Service Point (CSP)/Business Correspondent (BC) /agent locations are
at par.
• The extant charges
applicable on NEFT transactions should be displayed at all branches / locations
of the bank where NEFT transactions can be conducted.
• A printed “charges
card” in appropriate vernacular language should invariably be carried by agents
/ business correspondents of the banks.
• Positive confirmation
of credit to beneficiary account is invariably sent for all inward transactions
received by the bank.
• Banks originating the
NEFT transactions should ensure that the positive confirmation is relayed to
all remitting customers, including walk-in customers who provide their mobile
number / e-mail id.
• Intimation of failed
/ returned transactions should also be brought to the notice of the remitting
customer and funds credited to the account immediately / returned to the
remitter at the earliest.
• In case of delayed
credits or delayed returns, the penal interest as applicable is paid suo-moto
to the customer. Even in the case of back-dating or value-dating such delayed
transactions, banks should pay the penal interest for the delayed period.
Mobile banking transaction limits
The transaction limit of ` 50,000/- per
customer per day has been done away with for mobile banking transactions.
However, banks may place per transaction limits based on their own risk
perception with the approval of its Board.
Domestic Money
Transfer – relaxations
(a)
Cash Pay-out scheme which facilitates transfer of funds from the accounts of
their customers to beneficiaries not having bank accounts through the use of
ATMs, BCs etc. up to Rs. 10,000 per transaction subject to a monthly cap of `
25,000 with full details of the beneficiary.
(b) Cash Pay-in scheme where a walk-in /
non-account holding customer can transfer funds to a bank account of a
beneficiary etc. up to ` 5000 per transaction with a monthly cap of ` 25,000
with minimum details of the remitter.
(c) Card-to-Card transfers up to ` 5000 per
transaction subject to a monthly cap of 25,000.
Cheque Drop Box
Facility
Both the drop box facility and the facility
for acknowledgement of the cheques at regular collection counters should be
available to the customers and no branch should refuse to give an
acknowledgement if the customer tenders the cheques at the counters.
Banks should ensure that customers are not
compelled to drop the cheques in the drop-box. Further, in the context of
customer awareness in this regard, banks should invariably display on the cheque
drop-box itself that "Customers can also tender the cheques
at the counter and obtain acknowledgment on the pay-in-slips". The above
message is required to be displayed in English, Hindi and the concerned
regional language of the State.
Banks are also advised to make absolutely
fool proof arrangements accounting for the number of instruments each time
the box is opened so that there are no disputes and the customer’s
interests are not compromised.
Collection of
instruments
Formulating Cheque
Collection Policies
Keeping in view the above, earlier
instructions issued regarding immediate credit of local /outstation cheques,
time frame for collection of local/outstation instruments and interest payment
for delayed collection have been withdrawn by Reserve Bank leaving it to the individual
banks to formulate policies in this regard.
Broadly, the policy
should include instructions on the following:
• Immediate Credit for
Local / Outstation cheques
• Time frame for
Collection of Local / Outstation Instruments
• Interest payment for
delayed collection
Banks have been advised to reframe their
Cheque Collection Policies to include compensation payable for the delay in the
collection of local cheques as well. In case, no rate is specified in the
CCP for delay in realisation of local cheques, compensation at savings bank
interest rate should be paid for the corresponding period of delay.
With a view to encouraging faster migration
to CTS-2010 standard cheques, banks are advised that non CTS-2010 standard
instruments will be cleared at less frequent intervals in the CTS clearing centers.
Banks may educate and notify their customers of the likely delay in realisation
of non-CTS-2010 standard instruments in view of the arrangement for clearing of
such instruments at less frequent intervals. Banks’ Cheque Collection Policies
(CCPs) may also be modified suitably to reflect this change. They may also put
in place appropriate arrangement for handling customer complaints, if any,
arising out of this new arrangement.
Broad Principles
(i)
Banks
should formulate a comprehensive and transparent policy covering all the above
three aspects, taking into account their technological capabilities, systems
and processes adopted for clearing arrangements and other internal arrangements
for collection through correspondents.
(ii)
Further,
they may also review their existing arrangements and capabilities and work out
a scheme for reduction in collection period.
(iii)
Adequate
care also may be taken to ensure that the interests of the small depositors are
fully protected.
(iv)
The
policy framed in this regard should be integrated with the deposit policy
formulated by the bank in line with the IBA's model deposit policy.
(v)
The
policy should clearly lay down the liability of the banks by way of interest
payments due to delays for non-compliance with the standards set by the banks
themselves.
(vi)
Compensation
by way of interest payment, where necessary, should be made without any claim
from the customer.
The policy should be placed before the Board
of the Bank along with Reserve Bank's earlier instructions as indicated in
paragraph 3.2 and the Board's specific approval should be obtained on the
reasonableness of the policy and the compliance with the spirit of our
guidelines.
Delays
in Cheque Clearing - Case No. 82 of 2006 before National Consumer Disputes
Redressal Commission
Banks are advised to comply with the final
order on 'timeframe for collection of outstation cheques passed by the National
Consumer Disputes Redressal Commission in case no. 82 of 2006. Further, banks
are advised as under:
(i)
Banks
shall reframe their Cheque Collection Policies (CCPs) covering local and
outstation cheque collection as per the timeframe prescribed by the Commission.
(ii)
For
local cheques, credit and debit shall be given on the same day or at the most
the next day of their presentation in clearing. Ideally, in respect of local
clearing, banks shall permit usage of the shadow credit afforded to the
customer accounts immediately after closure of relative return clearing and in
any case withdrawal shall be allowed on the same day or maximum within an hour
of commencement of business on the next working day, subject to usual
safeguards.
(iii) Timeframe for
collection of cheques drawn on State Capitals / major cities / other locations
to be 7/10/14 days respectively. If there is any delay in collection beyond
this period, interest at the rate specified in the CCP of the bank, shall be
paid. In case the rate is not specified in the CCP, the applicable rate
shall be the interest rate on Fixed Deposits for the corresponding maturity. The
timeframe for collection specified by the Commission shall be treated as outer
limit and credit shall be afforded if the process gets completed earlier.
(iv)
Banks
shall not decline to accept outstation cheques deposited by its customers for
collection.
(v)
Banks
shall give wide publicity to the CCP by prominently displaying salient features
thereof in bold and visible letters on the notice board at their branches.
(vi)
A
copy of the complete CCP shall be made available by the branch manager, if the
customers require so.
Collection of Account Payee Cheque -
Prohibition on Crediting Proceeds to Third Party Account
a) Reserve Bank has considered it necessary
to prohibit the banks from crediting 'account payee' cheque to the account of
any person other than the payee named therein. Accordingly, banks were directed
that they should not collect account payee cheques for any person other than
the payee constituent.
Where the drawer / payee instructs the bank
to credit the proceeds of collection to any account other than that of the
payee, the instruction being contrary to the intended inherent character of the
'account payee' cheque, bank should ask the drawer / payee to have the cheque
or the account payee mandate thereon withdrawn by the drawer. This instruction
would also apply with respect to the cheque drawn by a bank payable to another
bank.
b) In order to facilitate collection of
cheques from a payment system angle, account payee cheques deposited with the
sub-member for credit to their customers' account can be collected by the
member bank (referred to as the sponsor member) of the Clearing House. Under
such arrangements, there should be clear undertaking to the effect that the
proceeds of the account payee cheque will be credited to the payee's account
only, upon realization.
c)
With
a view to mitigate the difficulties faced by the members of co-operative credit
societies in collection of account payee cheques, it is further clarified that
collecting banks may consider collecting account payee cheques drawn for an
amount not exceeding ` 50,000/- to the account of their customers who are
co-operative credit societies, if the payees of such cheques are the
constituents of such co-operative credit societies. While collecting the
cheques as aforesaid, banks should have a clear representation in writing given
by the co-operative credit societies concerned that, upon realization, the
proceeds of the cheques will be credited only to the account of the member of
the co-operative credit society who is the payee named in the cheque. This
shall, however, be subject to the fulfillment of the requirements of the
provisions of Negotiable Instruments Act, 1881, including Section 131 thereof.
d)
Banks
may note that the above instructions shall also extend to drafts, pay orders
and bankers’ cheque.
Payment of
Cheques/Drafts/Pay Orders/Banker’s Cheques
With effect from April 1, 2012, banks should
not make payment of cheques/drafts/pay orders/banker’s cheques bearing that
date or any subsequent date, if they are presented beyond the period of three
months from the date of such instrument. Banks should ensure strict compliance
of these directions and notify the holders of such instruments of the change in
practice by printing or stamping on the cheque leaves, drafts, pay orders and
banker’s cheques issued on or after April 1, 2012, by issuing suitable
instruction for presentment within the period of three months from the date of
the instrument.
Cheques
/ Instruments lost in transit / in clearing process / at paying bank's branch
Banks are advised to
follow the following guidelines regarding cheques lost in transit: - In respect
of cheques lost in transit or in the clearing process or at the paying bank's
branch, the bank should immediately bring the same to the notice of the
accountholder so that accountholder can inform the drawer to record stop
payment and can also take care that other cheques issued by him are not
dishonoured due to non-credit of the amount of the lost cheques / instruments.
(i)
The
onus of such loss lies with the collecting banker and not the accountholder.
(ii)
The
banks should reimburse the accountholder related expenses for obtaining
duplicate instruments and also interest for reasonable delays occurred in
obtaining the same.
(iii)
If
the cheque / instrument has been lost at the paying bank's branch, the
collecting banker should have a right to recover the amount reimbursed to the
customer for the loss of the cheque / instrument from the paying banker. Banks
are advised to incorporate the above guidelines in their Cheque Collection Policies.
Bills for collection
Bills for collection including bills
discounted, required to be collected through another bank at the realising
centre, should be forwarded directly by the forwarding office to the realising
office.
Payment of interest
for Delays in collection of bills
The lodger's bank should pay interest to the
lodger for the delayed period in respect of collection of bills at the rate of 2%
p.a. above the rate of interest payable on balances of Savings Bank accounts.
The delayed period should be reckoned after making allowance for normal transit
period based upon a time frame of 2 days each for (i) Dispatch of bills; (ii)
Presentation of bills of drawees (iii) Remittance of proceeds to the lodger's
bank (iv) Crediting the proceeds to drawer's account.
To the extent the delay is attributing to the
drawee's bank, the lodger's bank may recover interest for such delay from that
bank. The banks may suitably revise the format of their payment advices to
incorporate the above information.
Delay in Re-presentation of Technical Return
Cheques and Levy of Charges for such Returns:
Banks have been advised to levy cheque return
charges only in cases where the customer is at fault and is responsible for
such returns. The illustrative, but not exhaustive, list of returns, where the
customers are not at fault are indicated in the Annex VI. In cases where the
cheques need to be re-presented without any recourse to the payee, such
re-presentation should be made in the immediate next presentation clearing not
later than 24 hours(excluding holidays) with due notification to the customers
of such representation through SMS alert, email etc.
Dishonour of Cheques
– Procedure thereof
Returning dishonoured
cheques
(i)
Banks
are required to implement the recommendation of the Goiporia Committee that
dishonoured instruments are returned / dispatched to the customer promptly
without delay, in any case within 24 hours.
(ii)
It
is suggested that in addition to the existing instruction in respect of
dishonoured instruments for want of funds, banks may follow the additional
instructions laid down in paragraph 15.2 below which could cover all
cheques dishonoured on account of insufficient funds and not only those
relating to settlement transactions of Stock Exchanges.
Procedure for return/
dispatch of dishonoured cheques
(i)
The
paying bank should return dishonoured cheques presented through clearing houses
strictly as per the return discipline prescribed for respective clearing house
in terms of Uniform Regulations and Rules for Bankers' Clearing Houses. The
collecting bank on receipt of such dishonoured cheques should dispatch it
immediately to the payees / holders.
(ii)
In
relation to cheques presented direct to the paying bank for settlement of transaction
by way of transfer between two accounts with that bank, it should return such
dishonoured cheques to payees/ holders immediately.
(iii)
In
case of dishonor / return of cheques, the paying banks should clearly indicate
the return reason code on the return memo / objection slip which should also
bear the signature / initial of the bank officials as prescribed in Rule 6 of
the Uniform Regulations and Rules for Bankers’ Clearing Houses (URRBCH).
Information on
dishonoured cheques
Data in respect of each dishonoured cheque
for amount of 1 crore and above should be made part of bank's MIS on
constituents and concerned branches should report such data to their respective
controlling office / Head Office.
Data in respect of cheques drawn in favour of
stock exchanges and dishonoured should be consolidated separately by banks
irrespective of the value of such cheques as a part of their MIS relating to
broker entities, and be reported to their respective Head Offices / Central
Offices.
Dealing
with incidents of frequent dishonour of cheques of value 1 crore and above
(i) With a view to enforce financial
discipline among the customers, banks should introduce a condition for
operation of accounts with cheque facility that in the event of dishonour of a
cheque valuing rupees one crore and above drawn on a particular account of
the drawer on four occasions during the financial year for want of
sufficient funds in the account, no fresh cheque book would
be issued. Also, the bank may consider closing current account at its
discretion. However, in respect of advances accounts such as cash credit
account, overdraft account, the need for continuance or otherwise of these
credit facilities and the cheque facility relating to these accounts should be
reviewed by appropriate authority higher than the sanctioning authority.
(ii) For the purposes of introduction of the
condition mentioned at (i) above in relation to operation of the existing
accounts, banks may, at the time of issuing new cheque book, issue a letter
advising the constituents of the new condition.
(iii) If a cheque is dishonoured for a third
time on a particular account of the drawer during the financial year, banks
should issue a cautionary advice to the concerned constituent drawing his
attention to aforesaid condition and consequential stoppage of cheque facility
in the event of cheque being dishonoured on fourth occasion on the same account
during the financial year. Similar cautionary advice may be issued if a bank
intends to close the account.
Dealing with frequent
dishonour of cheques of value of less than 1 crore
Banks are therefore advised to have a Board
approved policy for dealing with frequent dishonour of cheques of value of less
than ` 1 crore. The policy should also deal with matters relating to frequent
dishonour of ECS mandates.
General
(i) For the purpose of adducing evidence to
prove the fact of dishonour of cheque on behalf of a complainant in any
proceedings, banks should extend full co-operation, and furnish documentary
proof of such dishonour.
(ii) Banks should place before their Audit/
Management Committee, every quarter, consolidated data in respect of the
matters referred to above.
Framing appropriate
procedure for dealing with dishonoured cheques
Banks are also advised to adopt appropriate
procedure for dealing with dishonoured cheques to prevent any scope for
collusion of staff with the drawer of the cheque for causing delay in
communicating the fact of dishonour to the payee/ holder.
Dealing with
Complaints and Improving Customer Relations
Complaints/suggestions box
Complaints/suggestions box should be provided
at each office of the bank. A notice requesting the customers to meet the
branch manager regarding their grievances may also be displayed.
Complaint Book
/Register
IBA has prepared a format of the complaint
book with adequate number of perforated copies, so that the complainant is
given an acknowledgement instantly. A copy of the complaint is required to be
forwarded to the concerned Controlling Office of the bank along with the remark
of the Branch Manager within a time frame. All bank's branches should maintain such
complaints register in the branch either in the physical form or electronically.
The complaints registers should be
scrutinised by the Regional Manager during his periodical visit to the branches
and his observations/comments recorded in the relative visit reports.
Complaint Form
A complaint form, along with the name of the
Nodal Officer, may be provided in the homepage of bank’s website. The form
should indicate that the first point for redressal of complaints is the bank
itself and that complainants may approach the Banking Ombudsman only if the
complaint is not resolved within a month. Similar information may be displayed
in the boards put up in the branches to indicate the name and address of the
Banking Ombudsman and the Controlling Authority of the bank to whom complaints
can be addressed.
Analysis and Disclosure of complaints -
Disclosure of complaints / unimplemented awards of Banking Ombudsmen along with
Financial Results
The complaints received by the bank should be
analyzed
(i)
to
identify customer service areas in which the complaints are frequently
received;
(ii)
to
identify frequent sources of complaint;
(iii)
to
identify systemic deficiencies; and
(iv)
for
initiating appropriate action to make the grievance redressal mechanism more
effective.
Banks are also advised to disclose the
following brief details along with their financial results:
A. Customer Complaints
(a)
No.
of complaints pending at the beginning of the year
(b)
No.
of complaints received during the year
(c)
No.
of complaints redressed during the year
(d)
No.
of complaints pending at the end of the year
B. Awards passed by the Banking Ombudsman
(a)
No.
of unimplemented Awards at the beginning of the year
(b)
No.
of Awards passed by the Banking Ombudsmen during the year
(c)
No.
of Awards implemented during the year
(d)
No.
of unimplemented Awards at the end of the year
Banks are also advised to place the detailed
statement of complaints along with those pertaining to ATMs, and its analysis
on their web-site for information of the general public at the end of each
financial year.
Grievance Redressal
Mechanism
Banks should ensure that a suitable mechanism
exists for receiving and addressing complaints from its customers /
constituents expeditiously.
Banks are also
advised to:
(i)
Ensure
that the complaint registers are kept at prominent place in their branches.
(ii)
Have
a system of acknowledging the complaints.
(iii)
Fix
a time frame for resolving the complaints.
(iv)
Ensure
that redressal of complaints emanating from rural areas and those relating to
financial assistance to Priority Sector and Government’s Poverty Alleviation
Programmes also form part of the above process.
(v)
Prominently
display at the branches as well as websites, the names and contact details of
the officials who can be contacted for redressal of complaints.
(vi) Such names should also include the
concerned Nodal Officer appointed under the Banking Ombudsman Scheme, 2006.
(vii)
Further,
banks should also display on their web-sites, the names and other
details of their CMD / CEO and also Line Functioning Heads for various
operations to enable their customers to approach them in case of need, if
necessary.
(viii)
Where the complaints are redressed within the
next working day, banks need not include the same in the statement of
complaints.
Where the complaints are not redressed within
one month, the concerned branch / Controlling Office should forward a copy of
the same to the concerned Nodal Officer under the Banking Ombudsman Scheme and
keep him updated regarding the status of the complaint. In the final letter
sent to the customer regarding redressal of the complaint, banks should
indicate that the complainant can also approach the concerned Banking Ombudsman.
The details of the concerned Banking Ombudsman should also be included in the
letter.
Banks should give wide publicity to the
grievance redressal machinery through advertisements and also by placing them
on their web sites.
Display of Names of
Nodal Officers
With a view to making
the Grievance Redressal Mechanism more effective, banks are further advised to:
i)
Ensure
that the Principal Nodal Officer appointed under the Banking Ombudsman Scheme
is of a sufficiently senior level, not below the rank of a General Manager.
ii)
Contact
details of the Principal Nodal Officer needs to be prominently displayed in the
portal of the bank preferably on the first page of the web-site.
iii)
Grievance
Redressal Mechanism (GRM) should be made simpler even if it is linked to call
centre of customer care unit without customers facing hassles of proving
identity, account details, etc.
iv)
Adequate
and wider publicity are also required to be given by the respective financial
services provider.
The name and address of the Principal Nodal
Officer may also be forwarded to the Chief General Manager, Customer Education
and Protection Department, Reserve Bank of India, Central Office, 1st
Floor, Amar Building, Sir P.M.Road, Mumbai-400 001 (email: cgmcepd@rbi.org.in
).
Review of grievances
redressal machinery in Public Sector Banks
Banks should
critically examine on an on-going basis as to how Grievances Redressal Machinery
is working.
Banks should identify areas in which the
number of complaints is large or on the increase and consider constituting
special squads to look into complaints on the spot in branches against which
there are frequent complaints.
Banks may consider shifting the
managers/officers of branches having large number of complaints to other
branches/regional offices/departments at Head Offices where contacts with
public may be relatively infrequent.
At larger branches and at such of the
branches where there are a large number of complaints, the banks may consider
appointing Public Relations Officers /Liaison Officers for looking
into/mitigating the complaints/grievances of customers expeditiously.
The banks may arrange to include one or two
sessions on customer service, public relations etc., in training programmes
conducted in their training establishments. In cases where the contention of
the complainant has not been accepted, a complete reply should be given to him
to the extent possible.
Complaints relating to congestions in the
banking premises should be examined on a continuing basis and action taken for
augmentation of space, keeping in view the availability of larger accommodation
in the same locality at a reasonable rent and other commercial considerations.
Select Banks to
appoint Chief Customer Service Officer
All public sector banks, and some private
sector and foreign banks have been advised to appoint an internal ombudsman
designated as Chief Customer Service Officer (CCSO).These banks have been
selected on the basis of their asset size, business mix, etc.
The CCSO should not have worked in the bank
in which he/she is appointed as CCSO. The bank’s internal ombudsman will be a
forum available to bank customers for grievance redressal before they can even
approach the Banking Ombudsman.
Erroneous Debits
arising on fraudulent or other transactions
Vigilance by banks
Banks have been advised to adhere to the
guidelines and procedures for opening and operating deposit accounts to
safeguard against unscrupulous persons opening accounts. Banks should remain
vigilant to avoid lapses while opening accounts.
Compensating the
customer
(i)
If
the branch is convinced that an irregularity / fraud has been committed by its
staff, the branch should at once acknowledge its liability and pay the
just claim,
(ii)
Where
banks are at fault, the banks should compensate customers without demur, and
(iii)
Where
neither the bank nor the customer is at fault and the fault lies elsewhere in
the system, then also the banks should compensate the customers (up to a limit)
as part of a Board approved customer relations policy.
Extension of Safe
Deposit Locker / Safe Custody Article Facility
Allotment of Lockers
Linking of Allotment
of Lockers to placement of Fixed Deposits
To ensure prompt payment of locker rent,
banks may at the time of allotment, obtain a Fixed Deposit which would cover 3
years rent and the charges for breaking open the locker in case of an
eventuality. However, banks should not insist on such Fixed Deposit from the
existing locker-hirers.
Wait List of Lockers
Branches should maintain a wait list for the
purpose of allotment of lockers and ensure transparency in allotment of
lockers. All applications should be acknowledged and given the wait list
number.
Providing a copy of
the agreement
Banks should give a copy of the agreement
regarding operation of the locker to the locker-hirer at the time of allotment
of the locker.
Security aspects
relating to Safe Deposit Lockers
Operations of Safe
Deposit Vaults/Lockers
The security procedures should be
well-documented and the concerned staff should be properly trained in the
procedure. The internal auditors should ensure that the procedures are strictly
adhered to.
Customer due diligence for allotment of
lockers / Measures relating to lockers which have remained unoperated
(i)
Banks
should carry out customer due diligence for both new and existing customers at
least to the levels prescribed for customers classified as medium risk. If the
customer is classified in a higher risk category, customer due diligence as per
KYC norms applicable to such higher risk category should be carried out.
(ii)
Where
the lockers have remained unoperated for more than three years for medium risk
category or one year for a higher risk category, banks should immediately
contact the locker-hirer and advise him to either operate the locker or
surrender it and explain the reason why he / she did not operate the locker.
This exercise should be carried out even if the locker hirer is paying the rent
regularly. In case the locker-hirer has some genuine reasons, banks may allow
the locker hirer to continue with the locker. In case the locker-hirer does not
respond nor operate the locker, banks should consider opening the lockers after
giving due notice to him. In this context, banks should incorporate a clause in
the locker agreement that in case the locker is not operated for more than one
year, the bank would have the right to cancel the allotment of the locker and
open the locker, even if the rent is paid regularly.
(iii) Banks should have clear procedure drawn
up in consultation with their legal advisers for breaking open the lockers and
taking stock of inventory.
18.3 Embossing
identification code
Banks should ensure that identification Code
of the bank / branch is embossed on all the locker keys with a view to
facilitate Authorities in identifying the ownership of the locker keys.
Nomination Facility
Legal Provisions
Provisions in the
Banking Regulation Act, 1949
The Banking Regulation Act, 1949 was amended
by Banking Laws (Amendment) Act, 1983 by introducing new Sections 45ZA to 45ZF,
which provide, inter alia, for the following matters:
a.
To
enable a banking company to make payment to the nominee of a deceased
depositor, the amount standing to the credit of the depositor.
b.
To
enable a banking company to return the articles left by a deceased person in
its safe custody to his nominee, after making an inventory of the articles in
the manner directed by the Reserve Bank.
c.
To
enable a banking company to release the contents of a safety locker to the nominee
of the hirer of such locker, in the event of the death of the hirer, after
making an inventory of the contents of the safety locker in the manner directed
by the Reserve Bank.
The Banking Companies
(Nomination) Rules, 1985
The
Banking Companies (Nomination) Rules, 1985 which are self-explanatory, provide
for:-
(i)
Nomination
Forms for deposit accounts, articles kept in safe custody and contents of
safety lockers.
(ii)
Forms
for cancellation and variation of the nominations.
(iii)
Registration
of Nominations and cancellation and variation of nominations, and
matters related to the above.
Nomination facilities in respect of safe
deposit locker / safe custody articles
Sections 45ZC to 45ZF of the Banking
Regulation Act, 1949 provide for nomination and release of contents of safety
lockers / safe custody article to the nominee and protection against notice of
claims of other persons. Banks should be guided by the provisions of Sections
45 ZC to 45 ZF of the Banking Regulation Act, 1949 and the Banking Companies
(Nomination) Rules, 1985 and the relevant provisions of Indian Contract Act and
Indian Succession Act.
Reserve Bank of India has specified the
formats for the purpose of returning articles left in safe custody to the
nominee. In order to ensure that the amount of deposits, articles left in safe
custody and contents of lockers are returned to the genuine nominee, as also to
verify the proof of death, banks may devise their own claim formats or follow
the procedure, if any, suggested by the Indian Banks' Association for the
purpose.
Nomination Facility –
Sole Proprietary Concern
Banks may extend the nomination facility also
in respect of deposits held in the name of a sole proprietary concern.
Nomination Facility in Single Deposit
Accounts
Banks should generally insist that the person
opening a deposit account makes a nomination. In case the person declines to
fill in nomination, the bank should explain the advantages of nomination
facility. If the person still does not want to nominate, the bank should ask
him to give a specific letter to the effect that he does not want to make a
nomination and make a noting in case he refuses to do so. Banks should not refuse to open an account
solely on the ground that the person refused to nominate.
Acknowledgement of
Nomination
Banks should devise a
proper system of acknowledging the receipt of the duly completed form of
nomination, cancellation and / or variation of the nomination. Such
acknowledgement should be given to all the customers irrespective of whether
the same is demanded by the customers or not.
Registering the
nomination
Banks are required to register in its books
the nomination, cancellation and / or variation of the nomination made by their
depositor(s) / hirers.
Incorporation
of the legend “Nomination Registered” in pass book, deposit receipt etc. and
indicating the Name of the Nominee in Pass Books / Fixed Deposit Receipts
Banks may introduce the practice of recording
on the face of the passbook/ term deposit receipts the position regarding
availment of nomination facility with the legend "Nomination
Registered". Banks may also indicate the name of the Nominee in the Pass
Books / Statement of Accounts / FDRs, in case the customer so desires.
Separate nomination
for savings bank account and pension account
Banking Companies (Nomination) Rules, 1985
are distinct from the Arrears of Pension (Nomination) Rules, 1983. Nomination
exercised by the pensioner under the latter rules for receipt of arrears in the
pension account will not be valid for the other deposit accounts. A separate
nomination is necessary in terms of the Banking Companies (Nomination) Rules,
1985 for such other accounts.
Nomination Facility –
Certain Clarifications
Nomination facility in respect of deposits
(i) Nomination facility
is intended for individuals including a sole proprietary concern.
(ii)
Nomination
shall be made only in favour of individuals.
(iii) There cannot be more
than one nominee in respect of a joint deposit account.
(iv) Banks may allow
variation/cancellation of a subsisting nomination by all the surviving depositor(s) acting together.
(v) In the case of a
joint deposit account the nominee's right arises only after the death of all
the depositors.
(vi)
Witness in Nomination Forms: Attestation by
two witnesses is required only in case
of Thumb-impression(s). Signatures need not be attested.
(vii)
Nomination in case of Joint Deposit Accounts: Banks are to ensure
that their branches offer nomination facility to all deposit accounts including
joint accounts opened by the customers.
Nomination in Safe Deposit Lockers / Safe
Custody Articles
(i)
Nomination
facilities are available only in the case of individual depositors and not in
respect of persons jointly depositing articles for safe custody.
(ii)
Banking
Regulation Act does not preclude a minor from being a nominee for obtaining
delivery of the contents of a locker. However, the responsibility of the banks is
to ensure that, the articles were handed over to a person who, in law, was
competent to receive the articles on behalf of the minor.
(iii)
As
regards lockers hired jointly, on the death of any one of the joint hirers, the
contents of the locker are only allowed to be removed jointly by the nominees
and the survivor(s) after an inventory was taken in the prescribed manner.
Customer
Guidance and Publicity Educating Customers on the Benefits of nomination /
survivorship clause
(i)
The banks should endeavor to drive home to
their constituents the benefit of nomination facilities and ensure that this facility
is popularized among their constituents.
(ii)
Banks
should give wide publicity and provide guidance to deposit account holders on
the benefits of the nomination facility and the survivorship clause.
(iii)
Account
opening form should contain space for nomination so that the customers could be
educated about availability of such facilities.
(iv)
Unless
the customers prefer not to nominate, nomination should be a rule, to cover all
other existing and new accounts.
(v)
To
popularise the nomination facility, publicity may be launched, including
printing compatible message on cheque books, pass-book and any other literature
reaching the customers as well as launching periodical drives.
Settlement of claims
in respect of deceased depositors – Simplification of procedure Provisions of
the Banking Regulation Act, 1949
Accounts with
survivor/nominee clause
In the case of deposit accounts where nomination
facility was availed or where the account was opened with the survivorship
clause, the payment of the balance in the account, to the survivor or the nominee
represents a valid discharge of the bank's liability provided:
(a)
the
bank has exercised due care and caution in establishing the identity of the
survivor(s) / nominee and the fact of death of the account holder, through
appropriate documentary evidence;
(b)
there
is no order from the competent court restraining the bank from making the
payment from the account of the deceased; and
(c)
It
has been made clear to the survivor / nominee that he has received the payment
as a trustee and that such payment to him shall not affect the right or claim
of any other person.
while making payment to the survivor(s) /
nominee of the deceased depositor, the banks should desist from insisting on production
of succession certificate, letter of administration or probate, etc., or obtain
any bond of indemnity or surety from the survivor(s)/nominee, irrespective
of the amount standing to the credit of the deceased account holder.
Accounts without the survivor
/ nominee clause
Banks are required to adopt a simplified
procedure for repayment to legal heirs where the deceased depositor had not
made any nomination nor was the account opened with a survivor clause. In this
context, banks may fix a minimum threshold limit, up to which claims could be
settled without insisting on any documentation other than a letter of
indemnity.
Premature Termination
of term deposit accounts
In the case of term deposits, banks are
required to incorporate a clause in the account opening form itself to the
effect that in the event of the death of the depositor, premature termination
of term deposits would be allowed. The conditions subject to which such
premature withdrawal would be permitted may also be specified in the account
opening form. Such premature withdrawal would not attract any penal charge.
Treatment of flows in
the name of the deceased depositor
In order to avoid hardship, banks should
obtain appropriate authorization from the survivor(s) / nominee with regard to
the treatment of pipeline flows in the name of the deceased account holder. In
this regard, banks could consider adopting either of the following two
approaches:
The bank could be authorized by the
survivor(s) / nominee of a deceased account holder to open an account styled as
'Estate of Shri ________________, the Deceased' where all the pipeline flows in
the name of the deceased account holder could be allowed to be credited,
provided no withdrawals are made.
OR
The bank could be authorized by the
survivor(s) / nominee to return the pipeline flows to the remitter with the
remark "Account holder deceased" under intimation to them. They could
then approach the remitter to effect payment in the name of the appropriate
beneficiary.
Interest payable on
the deposit account of deceased depositor
In the case of a term
deposit standing in the name/s of
(i)
a
deceased individual depositor, or
(ii)
two
or more joint depositors, where one of the depositors has died,
The criterion for payment of interest on
matured deposits in the event of death of the depositor in the above cases has
been left to the discretion of individual banks subject to their Board laying
down a transparent policy in this regard.
In the case of balances lying in current account
standing in the name of a deceased individual depositor/sole proprietorship
concern, interest should be paid only from 1st May, 1983, or from
the date of death of the depositor, whichever is later, till the date of
repayment to the claimant/s at the rate of interest applicable to savings
deposit as on the date of payment.
Time limit for
settlement of claims
Banks should settle the claims in respect of
deceased depositors to the claimants within a period not exceeding 15 days
from the date of receipt of the claim subject to the production of proof of
death of the depositor and suitable identification of the claim(s), to the
bank's satisfaction.
Banks should report to the Customer Service
Committee of the Board, at appropriate intervals, the details of the number of
claims received and those pending beyond the stipulated period, giving reasons
thereof.
Claim Forms to be
made available
Banks are advised to provide claim forms to
any person approaching the bank for it. Claim forms may also be put on the
bank’s website so that claimants can access and download the forms without
having to visit the concerned bank.
Access to the safe deposit lockers / Return
of safe custody articles to Survivor(s) / Nominee(s) / Legal heir(s)
Access to the safe deposit lockers / return of
safe custody articles (with survivor/nominee clause)
·
If
the sole locker hirer nominates a person, banks should give him access in the
event of his death.
·
In
case of nomination in a locker hired jointly with the instructions to operate
it under joint signatures, the bank should give access of the locker jointly to
the survivor(s) and the nominee(s).
·
In
case the locker was hired jointly with survivorship clause, banks should follow
the mandate in the event of the death of one or more of the locker-hirers.
However, banks should take the following
precautions before handing over the contents:
(a)
Banks
should find out if there is any order from a competent court restraining the
bank from giving access to the locker of the deceased; and
(b)
Banks
should make it clear to the survivor(s) / nominee(s) that access to locker /
safe custody articles is given to them only as a trustee of the legal heirs and
such access given to him shall not affect the right or claim which any other person.
Similar procedure should be followed for
return of articles placed in the safe custody of the bank. Banks should note
that the facility of nomination is not available in case of deposit of safe
custody articles by more than one person.
While giving access to the claimants, the
banks should desist from insisting on production of succession certificate,
letter of administration or probate, etc., or obtain any bond of indemnity or
surety from them.
Access to the safe deposit lockers / return
of safe custody articles (without survivor/nominee clause)
Where the deceased locker hirer had not made
any nomination or where the joint hirers had not given any mandate by a clear
survivorship clause, banks are advised to adopt a customer-friendly procedure
drawn up in consultation with their legal advisers for giving access. Similar
procedure should be followed for the articles under safe custody of the bank.
Preparing Inventory
Banks should prepare an inventory before
returning articles left in safe custody / before permitting removal of the
contents of a safe deposit locker. The inventory shall be in the prescribed appropriate
Forms.
Banks are not required to open sealed/closed
packets left with them for safe custody or found in locker while releasing them
to the claimants.
Simplified
operational systems / procedures
As per the direction of Reserve Bank, the
Indian Banks' Association (IBA) has formulated a Model Operational Procedure
(MOP) for settlement of claims of the deceased constituents, under
various circumstances, consistent with the instructions contained in
this circular, for adoption by the banks.
Customer guidance and publicity
Banks should place on their websites the
instructions along with the policies & procedures with respect to deceased
claims. Further, a printed copy of the same should also be given to claimants
whenever a claim is received from them.
Settlement of claims
in respect of missing persons
As per the provisions of Section 108 of the
Indian Evidence Act, presumption of death can be raised only after a lapse of
seven years from the date of his/her being reported missing. As such, the
nominee / legal heirs have to raise an express presumption of death before a
competent court. If the court presumes that he/she is dead, then the claim in
respect of a missing person can be settled on the basis of the same.
Banks are advised to formulate a policy which
would enable them to settle the claims of a missing person. They may fix a
threshold limit, up to which claims in respect of missing persons could be
settled without insisting on production of any documentation other than (i) FIR
and the non-traceable report issued by police authorities and (ii) letter of
indemnity.
Settlement of Claims
in respect of Missing Persons in Uttarakhand Disaster
In the aftermath of Uttarakhand Natural
Disaster during June 14-20, 2013 the Office of the Registrar General of India,
Ministry of Home Affairs, has devised a procedure for Registration of Death of
Missing persons in Natural Calamities affected areas in Uttarakhand.
In view of the above, banks are advised to
settle the claims in respect of such missing persons, without insisting on
production of any documentation other than (i) the ‘Death Certificate’ issued
by the Designated Officer under MHA Circular and (ii) letter of indemnity.
Release
of other assets of the deceased borrowers to their legal heirs
Banks had represented that the principle of
not obtaining succession certificates etc., could be extended for settlement of
claims in respect of other assets of deceased customers including securities
held against advances after adjustment thereof. Banks are advised not to
insist upon legal representation for release of other assets of deceased
customers irrespective of the amount involved. Banks may, however, call for
succession certificates from legal heirs of deceased borrowers in cases where
there are disputes and all legal heirs do not join in indemnifying the bank or
in certain other exceptional cases where the bank has a reasonable doubt about
the genuineness of the claimant/s being the only legal heir/s of the borrower.
Unclaimed Deposits /
Inoperative Accounts in banks
Every banking company shall submit a return in
the prescribed form to the RBI, on all accounts in India which have not been
operated upon for 10 years. The return should be submitted within 30 days after
close of each calendar year (i.e., 31st December).
(i)
Banks
should make an annual review of accounts in which there are no operations for
more than one year. The banks may inform the customers in writing and
ascertain the reasons for the same. In case the non- operation in the account
is due to shifting of the customers from the locality, they may be asked to
provide the details of the new bank accounts to which the balance in the
existing account could be transferred.
(iii)
If
the letters are returned undelivered, they may immediately be put on enquiry to
find out the whereabouts of customers or their legal heirs in case they are
deceased through phone calls, e-mail or other known sources. In case the
whereabouts of the customers are not traceable, banks should consider
contacting the persons who had introduced the account holder or contact the
employer if any.
(iv)
A
savings as well as current account should be treated as inoperative / dormant
if there are no transactions in the account for over a period of two years.
(v)
In
case any reply is given by the account holder giving the reasons for not
operating the account, banks should continue classifying the same as an
operative account for one more year within which period the account holder may
be requested to operate the account. However, in case the account holder still
does not operate the same during the extended period, banks should classify the
same as inoperative account after the expiry of the extended period.
(vi)
For
the purpose of classifying an account as ‘inoperative’ both the type of
transactions i.e., debits as well as credit transactions induced at the
instance of customers as well as third party should be considered. However, the
service charges levied by the bank or interest credited by the bank should not
be considered.
(vii)
Since
the interest on Fixed Deposit account and/or dividend on shares is credited to
the Savings Bank accounts as per the mandate of the customer, the same should
be treated as a customer induced transaction. As such, the account should be
treated as operative account as long as such entries are credited to the account.
Such account can be treated as inoperative account only after two years from
the date of the last credit entry, provided there is no other customer induced
transaction.
(viii) Operation in such
accounts may be allowed after due diligence as per risk category of the
customer. Due diligence would mean ensuring genuineness of the transaction,
verification of the signature and identity etc. However, it has to be ensured
that the customer is not inconvenienced as a result of extra care taken by the
bank.
(ix)
There
should not be any charge for activation of inoperative account.
(x)
Banks
are also advised to ensure that the amounts lying in inoperative accounts
ledger are properly audited by the internal auditors / statutory auditors of
the bank.
(xi)
Interest
on savings bank accounts should be credited on regular basis whether the
account is operative or not. If a Fixed Deposit Receipt matures and proceeds
are unpaid, the amount left unclaimed with the bank will attract savings bank
rate of interest.
Banks may also consider launching a special
drive for finding the whereabouts of the customers / legal heirs in respect of
existing accounts which have already been transferred to the separate ledger of
‘inoperative accounts’.
Display list of Inoperative Accounts: Banks are advised
that they should display the list of unclaimed deposits/inoperative accounts which
are inactive / inoperative for ten years or more on their respective
websites. The list must contain only the names and address of the
account holder. However, the account number, its type and the name of the
branch shall not be disclosed.
Banks should also give on the same website,
the information on the process of claiming the unclaimed deposit/activating the
inoperative account and the necessary forms and documents for claiming the
same.
Strengthening the
Regulatory Framework for Unclaimed Deposits
Banks are advised to put in place a Board
approved policy on classification of unclaimed deposits; grievance redressal
mechanism; record keeping; and periodic review of such accounts.
Treatment of certain savings bank accounts
opened for credit of Scholarship amounts and credit of Direct Benefit Transfer
under Government Schemes
The Government has
expressed difficulties in crediting benefits into accounts with zero balance which
have been classified as inoperative due to non-operation of the account for
over two years.
Banks are therefore advised to allot a
different “product code” in their CBS to all such accounts so that the
stipulation of inoperative/dormant account does not apply while crediting
proceeds as mentioned above.
While allowing operations in these accounts,
due diligence should be exercised by ensuring the genuineness of transactions,
verification of signature and identity, etc. However, it has to be ensured that
the customer is not inconvenienced in any manner.
Treatment of accounts opened for credit of
Scholarship Amounts under Government Schemes
As directed by the Bombay High Court, banks
are advised to ensure that accounts of all student beneficiaries under the
various Central/State Government Scholarship Schemes are free from restrictions
of ‘minimum balance’ and ‘total credit limit’.
Customer
Confidentiality Obligations
The scope of the secrecy law in India has
generally followed the common law principles based on implied contract. The
bankers' obligation to maintain secrecy arises out of the contractual
relationship between the banker and customer, and as such no information should
be divulged to third parties except under circumstances which are well defined.
The following exceptions to the said rule are normally accepted:
(i)
Where
disclosure is under compulsion of law
(ii)
Where
there is duty to the public to disclose
(iii)
Where
interest of bank requires disclosure and
(iv)
Where
the disclosure is made with the express or implied consent of the customer.
Collecting Information from customers for
cross-selling purposes
At the time of
opening of accounts of the customers, banks collect certain information. While
complying with the above requirements, banks also collect a lot of additional
personal information. Banks should treat such information collected from the
customer as confidential and not divulge any details thereof for cross selling
or any other purposes. Banks may, therefore, ensure that information sought
from the customer is relevant to the perceived risk, is not intrusive, and is
in conformity with the guidelines issued in this regard.
Wherever banks desire to collect any
information other than the purpose of KYC, it may do so on a separate form,
purely on a voluntary basis, after explaining the objectives to the customer
and taking his express approval for the specific uses to which such information
could be put.
Transfer of account
from one branch to another
Instructions of a customer for transfer of
his account to another office should be carried out immediately on
receipt of his instructions. It should be ensured that along with the balance
of the account, the relative account opening form, specimen signatures,
standing instructions, etc., or the master sheets wherever obtained, are also
simultaneously transferred, under advice to the customer.
The account transfer form with the enclosures
may be handed over to the customer in a sealed cover if he so desires for
delivery at the transferee office / branch. However, the transferee office
should also be separately supplied with a copy of the account transfer letter.
When an office receives an enquiry from a
customer regarding the receipt of his account on transfer from another office
it should take up the matter with the transferor office by electronic means, in
case it has not received the balance of the account and/or other related papers
even after a reasonable transit time.
Switching banks by
customers
Banks should ensure that depositors
dissatisfied with customer service have the facility to switch banks and
thwarting depositors from such switches would invite serious adverse action.
Co-ordination with
officers of Central Board of Direct Taxes
Banks should extend necessary
help/co-ordination to tax officials whenever required. Further, banks will have
to view with serious concern cases where their staff connive/assist in any
manner with offences punishable under the Income Tax Act. In such cases in addition
to the normal criminal action, such staff member should also be proceeded
against departmentally.
Declaration of
Holiday under the Negotiable Instruments Act, 1881
In terms of Section 25 of the Negotiable
Instruments Act, 1881, the expression "public holiday" includes
Sunday and any other day declared by the Central Government by notification in
the Official Gazette to be a public holiday. This power has been delegated by
the Central Government to State Governments. However when Central Government
itself has notified a day as "public holiday" under Section 25 of the
Negotiable Instruments Act, 1881, there is no need for banks to wait for the
State Government notification.
Miscellaneous
Sunday banking
In predominantly residential areas banks may
keep their branches open for business on Sundays by suitably adjusting the
holidays. Banks should keep rural branches open on weekly market day.
Accepting standing
instructions of customers
Standing instructions should be freely
accepted on all current and savings bank accounts. The scope of standing
instructions service should be enlarged to include payments on account of
taxes, rents, bills, school / college fees, licenses, etc.
Clean Overdrafts for
small amounts
Clean overdrafts for small amounts may be
permitted at the discretion of branch manager to customers whose dealings have
been satisfactory. Banks may work out schemes in this regard.
Rounding off of
transactions
All transactions, including payment of
interest on deposits/charging of interest on advances, should be rounded off to
the nearest rupee i.e., fractions of 50 paise and above shall be rounded off to
the next higher rupee and fraction of less than 50 paise shall be ignored.
Issue prices of cash certificates should also be rounded off in the same
manner. However, banks should ensure that cheques/drafts issued by clients
containing fractions of a rupee are not rejected or dishonoured by them.
Various Working Groups / Committees on
Customer Service in Banks - Implementation of the Recommendations
In order to keep a watch on the progress
achieved by the bank in the implementation of the recommendations of various
working groups/Committees on customer service, banks may examine the
recommendations which have relevance in the present day banking and continue to
implement them. Banks may consider submitting periodically to their Customer
Service Committee of the Board a progress report on the steps/ measures taken
in that regard.
Code of Bank’s
Commitment to Customers
Banks should follow various provisions of the
Code of Bank’s Commitment to Customers, implementation of which is monitored by
the Banking Codes and Standards Board of India (BCSBI).
Based on RBI Master
Circular Dated 1/7/15.
Please refer www.rbi.org.in in case of any clarification if
needed…………… Poppy
No comments:
Post a Comment