How to lodge a complaint against your bank

A five-point guide to redress your banking woes

As consumers we often feel our voice is lost especially while dealing with large corporations. Unfortunately, we do little to stand our ground and fight for justice. As far as banking goes, the banking regulator Reserve Bank of India, RBI has done a lot to protect the customer and many of our complaints with banks can be resolve with time and effort.

Story

Shama Misra, 30-year-old mother of two was fed up. Every day she got calls from a bank (or their agents) that she should pay interest for not maintaining a minimum balance in an account which she had requested the bank to close 18 months ago when she had withdrawn all the money to close the account.

Yet the bank had been adding on hefty charges and making her increasingly nasty calls about paying up the amount. What’s more, it was now reflecting on her credit report and she got refused for a credit card she applied for because of this negative report.

Horror stories in banking are hardly new. RBI receives over 72,000 complaints a year. Besides these, thousands others are resolved at the bank level and many more never get reported. The banking system is a collection of people, both bankers and clients and mistakes -- both unintentional errors and intentional misrepresentations -- are common enough.

What do you do, then, if you face a situation similar to that if Misra?

A step-by-step guide to handling a complaint against your bank:

The author is a credit expert with 10 years of experience in personal finance and consumer banking industry and another 7 years in credit bureau sector. Rajiv was instrumental in setting up India's first credit bureau, Credit Information Bureau (India) Limited (CIBIL). He has also worked with Citibank, Canara Bank, HDFC Bank, IDBI Bank and Experian in various capacities.

Step 1: Contact your bank

Call up your bank’s customer care number or hop over to your bank to speak to the bank staff and try to express your problem and get it sorted out at this stage. It is surprising to see many problems are simple errors and can be sorted out by individual interaction.

Step 2: Send a written complaint

While most matters are amicably resolved, there are some which need a more formal complaint and should be taken to the next level by writing to the bank. You can write to the address provided by them or the email ID of the customer care. It is best to do both. Do ensure you keep a dated copy of the letter and proof that you sent it.

Step 3: Escalate the matter

If you are not satisfied with the resolution provided through these channels, you can ask for the contact details of senior officials and can escalate the issue to them. At all stages the bank will make attempts to resolve the complaint since it reflects badly on them if a complaint goes unresolved. Each bank nowadays has a special cell appointed to investigate the matter and understand the root cause of their customers’ problems.

Step 4: Contact the Banking Ombudsman

If the bank is unable to resolve your complaint or has not responded to your written complaint within a month it is time to call in the big guns the banking ombudsman. The ombudsman is an official appointed by the RBI to redress customer complaints. All scheduled commercial banks, regional rural banks and scheduled primary cooperative banks are covered under the scheme.

Currently, there are 15 ombudsmen located mostly in state capitals. Their addresses and contact details are available on the RBI website (www.rbi.org.in). As on date, there are 27 grounds on which customers can approach the Banking Ombudsman citing deficiency in banking services.

The banking ombudsman will make its decisions after considering all the salient points and make its recommendation to the bank and the complainant.

Step 5: For a final judgement

If you are unsatisfied with the decision of the ombudsman, you can file an appeal with the appellate authority i.e. the Deputy Governor of RBI within 30 days of the ombudsman’s judgement. One can also approach consumer redressal forums, which take up bank-related complaints. The last way to appeal is in the consumer courts.