s mundra : customer service in banks – caveat venditor 1 keynote address by mr s s mundra, deputy governor of the reserve bank of india, at the conference of the principal code compliance officers, organized by the banking codes and standards board of india ( bcsbi ), mumbai, 23 may 2016. * * * the assistance provided by shri r. sathish and shri p. j. mathkar is gratefully acknowledged. introduction 1. shri c. krishnan, member, governing council, banking codes and standards board of india ( bcsbi ) ; shri anand aras, ceo, bcsbi ; colleagues from the banking community, representatives from the media ; ladies and gentlemen! at the outset, i would like to thank bcsbi for inviting me to inaugurate this annual conference of the principal code compliance officers ( pccos ) in the banks. over the years, bcsbi has been instrumental in driving improvement in level of service extended by the banks to their customers. all of you are pretty familiar with role of bcsbi so i am not going to elaborate on that. you must also be aware about the two sets of codes that bcsbi has developed for its member banks, namely : • code of bank ’ s commitment to customers and • code of bank ’ s commitment to micro and small enterprises these codes are reviewed periodically with a view to incorporate all the relevant regulatory guidelines, contemporary developments in the banking sector and evolving customer expectations. the bcsbi, in a way, helps the banks by providing an independent review and feedback on their adherence to the standards. rbi attaches great importance to the work and assessments of the bcsbi, which places an onerous responsibility on the bcsbi in this relatively unexplored territory. 2. i am sure that today ’ s deliberations will be a good opportunity for the participants : • to deliberate upon the issues in implementation of the codes • to appreciate the importance of imbibing the codes as a basic norm in day to day dealing with customers and • to understand the linkage of the codes with the overarching principles of charter of customer rights which is being implemented in your respective banks 3. a major challenge for all of us in the banking industry is to develop the right attitude for rendering service to customers. a broader question is whether we can define the standards of behaviour? perhaps, it may be easier to identify the elements of unacceptable behaviour and try to

regions together accounted for 64 % of all financially excluded farmer households in the country. overall indebtedness to formal sources of finance of these three regions accounted for only 19. 66 %. however, over the period of five decades, there has been overall improvement in access to formal sources3 of credit by the rural households ( chart 1 ). source : national sample survey on household consumption expenditure. the coefficient ranges from zero to one, with zero representing perfect equality and one showing perfect inequality. all india debt and investment survey, nsso 59th round. formal sources include credit from scbs ( including rrbs ) and credit from co - op society / bank and informal sources include credit from agricultural and professional money lenders. bis central bankers ’ speeches 2. 2 government of india population census 2011 as per census 2011, only 58. 7 % of households are availing banking services in the country. however, as compared with previous census 2001, availing of banking services increased significantly largely on account of increase in banking services in rural areas ( chart 2 ). 2. 3 crisil financial inclusion index ( inclusix ) in june 2013, crisil first time published a comprehensive financial inclusion index ( viz., inclusix ). for constructing the index, crisil identified three critical parameters bis central bankers ’ speeches of basic banking services namely branch penetration4, deposit penetration5 and credit penetration6. the crisil inclusix indicate that there is an overall improvement in the financial inclusion in india ( chart 3 ). crisil – inclusix ( on a scale of 100 ) increased from 35. 4 in march 2009 to 37. 6 in march 2010 and to 40. 1 in march 2011. 2. 4 rbi working paper study sadhan kumar7 ( 2011 ) worked out an index on financial inclusion ( ifi ) based on three variables namely penetration ( number of adults having bank account ), availability of banking services ( number of bank branches per 1000 population ) and usage ( measured as outstanding credit and deposit ). the results indicate that kerala, maharashtra and karnataka has achieved high financial inclusion ( ifi > 0. 5 ), while tamil nadu, punjab, a. p, h. p, sikkim, and haryana identified as a group of medium financial inclusion ( 0. 3 < ifi < financial low very have states remaining the and > 2. 5 world bank “ financial access survey ” results from the table 1 given below, it would be