The consumer is indeed the king -- even in the banking sector. Your bankers may now have to compensate you for any losses incurred due to their fault.
Also, if you apply for a loan and the branch manager tells you the loan application has been rejected, you will have the right to receive in writing an explanation from the bank detailing the reasons for the refusal.
Banks can no longer get away with causing losses to their customers, and refusing them banking services, as it will be mandatory for every bank to float a compensation policy once it signs the charter of the Banking Codes and Services Board (BCSB), which is to be launched on Saturday by Reserve Bank of India (RBI) Governor Y V Reddy.
All signatories to the charter will have to lay down a compensation policy to make up for losses incurred by customers due to mistakes committed by bank employees.
The gamut of retail banking services, including savings accounts, term and demand deposits, credit cards, debit cards, foreign exchange remittances, and loan accounts will be covered by the compensation policy.
Though adherence to the charter of rights prepared by the BCSB would be voluntary, none of the banks could afford to ignore the consumer initiative which was backed by the banking regulator, senior bankers said.
The banking regulator feels that banks often extract "stealth money" from unsuspecting customers while offering some of their services.
"Some banks over-charge interest for late payment of credit card bills when it actually does not happen. They even remit money a few days later than the advised date, make debit and credit entries without the customer's knowledge, and debit an account for payment of loan instalment after the due date, only to charge extra interest," say banking sources.
The charter of rights will attempt to prevent banks from exploiting their customers in any such way.
