Friday, November 27, 2015

Banks have no time for customer

What you get instead are hidden costs for supposedly myriad services, most of which don’t seem to exist.

One leading new generation private bank does not disburse cash other than through ATM/debit card withdrawals. Yet it charges Rs.1,000 annually for issue of the debit card, on top of keeping the minimum average balance of Rs.10,000 for a basic savings bank account for a customer.

Why choose such a bank? Because other banks, though with lower minimum balance requirements, are worse when it comes to customer service.

I credited a couple of cheques to my pension account with the SBI drawn on another local PSB branch on November 6. While one of the instruments for Rs.10,000 got credited on the same day, the other for Rs.70,000 was credited only six days later after relentless pursuit. A complaint email gets the standard response: “This is a system generated response. Your complaint takes 48 hours to respond. Please do not reply.”

Ever since the introduction of two week-end holidays, local cheques presented in clearing on the preceding day wait for credit into the account for three to four days.
Customer care-less

From the Talwar Committee (1975) to the Goiporia Committee in 1990, and from the Tarapore Committee (2004) to Damodaran Committee (2011), there have been enough recommendations regarding the importance of the customer. Customer Service Committee meetings are more on paper. After digital banking, banks seem to have got busier than before.

Customers today broadly fall under the following segments, each demanding specific types of services and attention: 1. Illiterate and semi-literate rural and urban ; 2. Old generation ; 3. Net savvy and digital ; 4. mobile banking ; 5. Credit card and 6. Credit.

The first category requires personal attention and financial literacy. The second seeks personal attention. The third to fifth categories require cyber security as they may rarely visit the bank once they have opened their account with compliance to KYC norms. All types of customers expect and deserve fair treatment.

The ‘Treating Customers Fairly’ concept consists of six universally recognised components: (i) Confidence, (ii) Demand-Supply Match, (iii) Transparency, (iv) Advisory Role, (v) Satisfactory Redressal System and (vi) Switch-Over.

Excepting the first two, PSBs do not meet the other four requirements while private sector banks believe in routine net and SMS replies.

Most banks, including PSBs, are expected to air only structured grievances on their website. If you click ‘others’, it does not provide for acceptance of the text.

False claims

In the pre-liberalisation period transfer transactions would be entertained even after banking hours. Today they shut their doors after banking hours.

There are no secure drop boxes outside the branch where such cheques can be picked up for realisation at the start of the day. Net transactions have become easier but speed is an issue when you are greeted with ‘time out log in again’. These banks claim they provide 24/7 customer service.

Banks starved of income from credit portfolio started looking at other income from all types of services. The more you transact on the net, the more charges you pay — convenience charges — for banks’ or customers’?

PSBs do not have time to provide advisory services because of the crowds they need to handle during business hours. Till 2005 bank managers would call on important customers.

Today, even when the customer calls on the branch the manager has little time to speak to him/her. The latter has become a servant of the machine before him.

PSBs’ ATMs, particularly those belonging to the SBI group, have started feeding only Rs. 100 notes or limiting the drawal to Rs. 5000/10000 each time, although technically the depositor can draw Rs. 40,000 a day and Rs. 15,000 at a time.

Even for drawing Rs10,000 the depositor has to pay extra service charges. This is an ingenious way of extorting money from the customers.

There is neither speed of transaction nor convenience at the bank branch. It is time that the RBI conducts a specific customer service audit to know the status of implementation of listed practices in the code for banking standards.

(This article was published on November 24, 2015)
Printable version | Nov 27, 2015 11:59:30 AM | © The Hindu Business Line