Model Policy on Grievance Redressal in Banks and financial institutions

In a speech in South Africa in 1890 Mahatma Gandhi said this: “A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption of our work. He is the purpose of it. He is not an outsider to our business. He is part of it. We are not doing him a favour by serving him. He is doing us a favour by allowing us to do so.”

This is a philosophy well worth absorbing and putting at the heart of all customer interactions. If we think of the idea of extending warm, welcoming hospitality to the customer with courtesy and attentiveness, rather than offering cool technical efficiency on a transactional basis, expecting the customer to be polite to us rather than the other way round, then we will get closer to the truth of what customer-satisfying service is.

Customer complaint is part of the business life of any corporate entity more so for banks are service organizations because banks are customer-centric service organizations. As a service organization, customer service and customer satisfaction should be the prime concern of any bank. Efficient service is essential not only to attract new customers but also to retain existing ones.  Intemperate customer behaviour is not to be seen as a fault in the customer, it should be viewed as a sign that something is wrong with the bank and its product/service offering. It almost always has a reason behind it. Generally speaking, that reason is related to the fact that a customer perceives that his or her needs are not being met. One has to accept the customer on his or her terms, not ours. Getting customers to be more polite is not the right idea. Asking what we or our organisation is bringing to the relationship that is not meeting the customer’s needs is.

A model grievance redressal policy formulated by the Reserve Bank of India shall be followed by every regulated entity like banks and financial institutions that includes the following principles:

Timely response: Complaints should be addressed as soon as possible and within a maximum time frame.

Escalation: If a complaint is pending for more than two weeks, it should be escalated to the next level of authority within the organization.

Customer treatment: Customers should be treated fairly and with courtesy at all times.

Information: Customers should be informed of their rights to alternative remedies and how to escalate their complaints.

Internal processes: A nodal officer should ensure that the internal machinery for handling complaints operates smoothly and efficiently.

Internal ombudsman: An internal ombudsman can be set up to ensure fair disposition of customer disputes.

Complaint classification: Complaints should be classified as “enquiry”, “request”, or “complaint”.

Complaint reference number: A complaint reference number should be provided to the customer.

Tracking: A robust internal mechanism should be in place to track open complaints.

It would be the responsibility of the Nodal Officer of the bank to ensure that

• Customers be treated fairly at all times
• Complaints raised by customers are dealt with courtesy and on time
• Customers are fully informed of avenues to escalate their complaints/grievances within the organization and their rights to alternative remedies if they are not fully satisfied with the response of the bank to their complaints.
• The bank will treat all complaints efficiently and fairly as they can damage the bank’s
• Reputation and business if handled otherwise.
• The bank employees must work in good faith and without prejudice to the interests of the customer

To enable the customers to voice their grievances or offer suggestions for improvement in customer service, Customer Day is observed at all the offices of banks covering, branches, regional offices, Zonal Offices, and Head office on the 15th of every month (If the 15th is a holiday, then preceding working day)

In case of any complaint, the matter may first be brought to the knowledge of the branch manager for immediate redressal.

If the complaint is not addressed to the satisfaction of the customer, the complaint may be taken up with higher authorities like the Regional Office/Zonal Office heads concerned.

The complainant still feels unsatisfied with the responses of higher authorities; he can address the complaint to the Bank’s Principal Nodal Officer at the Head Office designated to deal with customers’ complaints/grievances giving full details of the complaint.

After exhausting all the above machinery/channels, the customer may write to the Chairman and Managing Director of the Bank if the customer is not satisfied. In any case, if the complainant is not happy with the reply given by the Bank; the Complainant is free to recourses to the following.

The Banking Ombudsman is located in state Capitals under the RBI ombudsman scheme.

Directorate of Public Grievances, Government of India, Cabinet Secretariat, Sansad Marg, New Delhi

The District Consumer Forum under the Consumer Protection Act 1985

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