existing institutional mechanism in this regard is not adequate. accordingly, and in order to ensure fair practices in banking services, the rbi has recently issued instructions to banks making it obligatory for them to display and continue to keep updated, in their offices / branches as also in their website, the details of various services charges in a format prescribed by it. the reserve bank has also decided to place details relating to service charges of individual banks for the most common services in its website. furthermore, reserve bank has since constituted a working group headed by the banking ombudsman, mumbai and including nominee of iba and representatives of customers to formulate a scheme for ensuring reasonableness of bank charges and to incorporate this in the fair practices code, the compliance of which will be monitored by the banking codes and standards board of india ( bcsbi ). customer service – institutional machinery in the area of customer service, the institutional machinery in banks should comprise • at the board level, every bank has been asked to constitute a customer services committee of the board including as invitees experts and representatives of customers to enable the bank to formulate policies and assess the compliance thereof internally. • every bank has been asked to convert the ad hoc committee of executives on customer service headed by the cmd / ed into a standing committee that periodically reviews the policies and procedures and working of the bank ’ s own grievance redressal machinery. these committees have been found to be very useful as the ceo of the bank and his top management team is singularly focused on matters relating to customer services at the meetings of these committees and decisions for improving services tend to get taken instantly, cutting across different departments. • each bank is expected to have a nodal department / official for customer service in the ho and each controlling office, whom customers with grievances can approach in the first instance and with whom the banking ombudsman and rbi can liaise. more interaction between the rbi / bo and the nodal officers will enable banks to take necessary correctives at the local level. financial inclusion in the context of the focus on financial inclusion and distress amongst farmers, there is a need for the formal financial system to look at increasing financial literacy and financial counselling. as part of the community reinvestment act in us, banks are expected to contribute towards educating persons from socially and financially disadvantaged groups on matters relating to their financial needs. indian banks and financial market players should actively look at promoting such programs as part of their corporate social responsibility.

usha thorat : treating bank customers fairly - regulatory initiatives inaugural address by ms usha thorat, deputy governor of the reserve bank of india, at the financial planning congress 2006 on “ establishing consumer centric financial services delivery infrastructure ”, organised by the financial planning standards board india, new delhi, 29 may 2006. * * * it gives me great pleasure to participate in this congress organised by the financial planning standards board india. today, there is much more awareness of the need to protect consumers'rights and ensure fair practices in financial services. countries are designating specific regulators or self regulatory watch dogs for overseeing whether there is mis - selling and whether fair and transparent practices are being observed by financial intermediaries. while specific grievances relating to deficiency in financial services can be a matter for consumer courts or the concerned ombudsman, from a systemic point of view, it is recognised that services have to be benchmarked against codes and standards developed by all stakeholders and as a matter of public policy. in this context, an organisation such as the fpsb india whose mission is the development and promotion of standards for financial planning professionals to benefit among others, the general public is indeed timely and relevant. the fpsb needs to be congratulated for holding this congress, which i am sure, will throw up a number of issues keeping in view the central theme viz. the interests of the consumer. i am glad to note that the fpsb india is also focusing on financial literacy and solutions for the rural population. the focus on the common man is extremely important in our country as he is usually the neglected one. at the annual meeting of iba last friday, the hon'ble finance minister has talked about financial inclusion and targeting the bottom of the pyramid. with greater penetration of formal financial services into the economy and society, there is a need for ensuring evolution and adherence to codes and standards in delivering financial services to the financially excluded. the banking system in india today has perhaps the largest outreach for delivery of financial services. apart from the traditional financial products viz. deposits, loans and money transfer, bank branches are also serving as an important conduit for delivery of mutual funds, other capital market and insurance products. the number of savings accounts with scheduled commercial banks in india stood at little over 300 million in march 2005. if one were to take into account cooperative banks, the number would be even higher. taking into account the number of households in the country this number certainly