Lok Sabha Question No. 3577 (UNSTARRED), answered on 2022-08-08
Subject: Complaints against Banks
Ministry: FINANCE
Asked by: Talari Rangaiah

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA

## UNSTARRED QUESTION NO. 3577

TO BE ANSWERED ON THE 08 th  AUGUST, 2022 / SRAVANA 17, 1944 (SAKA)

'Complaints against Banks'

## 3577.    DR. TALARI RANGAIAH:

Will the Minister of FINANCE be pleased to state:

- (a)    whether the number of complaints against Banks is increasing year by year;
- (b)    if so, the details of nature and number of complaints against both public and private sector banks; and
- (c)    the corrective measures taken by the Government and outcomes thereof so far?

## ANSWER

MINISTER OF STATE IN THE MINISTRY OF FINANCE (DR.  BHAGWAT KARAD)

- (a) & (b): As per the information received from Reserve Bank of India (RBI), banks are primarily  responsible  for  redressal  of  complaints  received  against  them  from  their customers.

As informed by RBI, the number of complaints against Public Sector Banks (PSBs) and Private  Sector  Banks  under  various  complaint  categories  which  were  received  and disposed  by  Office  of  RBI  Ombudsmen  (ORBIOs)  as  on  July,  25,  2022  under  the erstwhile Banking Ombudsman Scheme (BOS), 2006 and the Reserve Bank-Integrated Ombudsman  Scheme  (RB-IOS),  2021  from  April  01,  2019  to  July  25,  2022  are furnished below:

Table: Consolidated year-wise complaints Received and Disposed at ORBIOs

| Year                             | Number of complaints received   | Number of complaints disposed   |
|----------------------------------|---------------------------------|---------------------------------|
| April 01, 2019 to March 31, 2020 | 2,62,004                        | 2,62,004                        |
| April 01, 2020 to March 31, 2021 | 3,01,277                        | 3,01,277                        |
| April 01, 2021 to March 31, 2022 | 2,41,242                        | 2,41,238                        |
| April 01, 2022 to July 25, 2022  | 51,447                          | 37,640                          |

Source: RBI

Complaints received normally pertain to issues related to ATM/debit cards/credit cards, mobile/electronic banking, failure to meet commitments, non-observance of fair practice code, levy of charges without prior notice, loans and advances, deposit accounts and pension payments etc.

(c): RBI  has  taken various initiatives over the years for improving customer service and grievance redress mechanism in banks. Detailed guidelines on customer service have  been  issued  to  banks  encompassing  various  aspects  of  operations  that  impact customers.  The  BOS  was  introduced  in  1995  to  serve  as  an  alternative  grievance redress mechanism for customer complaints against banks. The Scheme was amended periodically  to  keep  in  tune  with  the  changing  landscape  in  the  banking  sector  and formed the basis for launch of two other Ombudsmen Schemes for NBFCs and Nonbank  Payment  System  Participants.  The  three  Schemes  were  merged  into  RB-IOS, 2021. Along with the RB-IOS, the Centralised Receipt and Processing Center (CRPC) was also established at RBI, Chandigarh for receipt and initial processing of physical and  email  complaints.  A  Contact  Center  has  also  been  set  up  at  CRPC  which  is available  at  Toll  Free  Number  14448  to  provide  information  on  grievance  redress mechanism of RBI to complainants.

As  part  of  the  disclosure  initiative,  banks  were  advised  to  disclose  in  their  annual reports,  summary  information  regarding  the  complaints  handled  by  them;  and  certain disclosures were also being made in the Annual Report of the Ombudsman Schemes published by the Reserve Bank. The disclosure requirements were made granular as a part of framework for strengthening the Internal Grievance Redress (IGR) mechanism of banks vide RBI circular dated January 27, 2021.

RBI has also taken various initiatives for creating customer awareness with respect to digital transactions such as:-

(a)  Making  customers  aware  of  RBI  instructions  on  frauds  in  electronic  banking transactions by having a re-run of the campaigns on its regulations limiting the liability of customers in fraudulent electronic banking transactions;

(b) Making customer aware of the RB-IOS as an integrated ombudsman scheme for all the customers of digital financial services offered by entities regulated by RBI (bank as well as non-bank payment system participants);

(c) A multi-media campaign on RB-IOS, 2021 is being carried out at Pan-India level;

(d)  Campaigns  on  Safe  Digital  Banking  focusing  on  UPI  frauds  and  AEPS  are  also being carried out.

Further,  Department  for  Payment  and  Settlement  Systems  of  RBI,  vide  circular DPSS.CO.OD.No.1934/06.08.005/2019-20  dated June 22, 2020 has advised all authorized  payment  systems  operators  and  participants  (banks  and  non-banks)  to undertake  targeted  multi-lingual  campaigns  by  way  of  SMSs,  advertisements  in  print and  visual  media,  etc.,  to  educate  their  users  on  safe  and  secure  use  of  digital payments.

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