29 Dec, 2014 | Times of India
The Charter of Customers’ Rights released by the RBI lays down five basic things that you enjoy as a bank customer. You can file a complaint if these are violated.
Right to fair treatment
This right prohibits banks from discriminating against customers on grounds of gender, age, religion, caste and physical ability.Banks can, however, continue to offer differential rates of interest or products to customers. The financial services provider may have certain products which are designed for members of a target group or may use defensible, commercially acceptable economic rationale for discriminating between customers, the central bank says.
Right to transparency, fair and honest dealing
You can expect language in bank documents to be simplified and transparent. The charter requires banks to ensure that all contracts are easily understood by the common person. The onus of sending out effective communication about products will rest with banks. Information on the product, price, customer responsibilities and key risks will have to be clearly stated. Important terms and conditions should be clearly brought to the notice of the customer, the charter states.
Right to suitability
Despite several regulations, complaints related to mis-selling continue to plague the distribution space. Lured by higher commissions, sales officials tend to push products without ascertaining their suitability for the customer.With this charter coming into force, such officials might find it difficult to palm off say market-linked insurance products to senior citizens. The charter has made it mandatory for banks to sell products after keeping in mind customers’ needs, financial circumstances and understanding.
Right to privacy
Banks are duty-bound to keep customers information confidential. Customers have the right to protection from all kinds of communications which infringe upon their privacy, the charter states. Banks cannot pass on your details to telemarketing companies or for cross-selling. ‘There have been instances where bank officials have asked customers to route their investments through them (banks act as distributors for mutual funds and insurance firms).This is unethical’, says Roongta.
Right to grievance redressal and compensation
The charter makes banks accountable for their own products as well as those of third parties like insurance companies and fund houses. They will no longer be able to wash their hands of the responsibility once the product is sold. Banks will have to communicate the policy for compensating for mistakes on their part, lapses in conduct and non-performance or delays.The redressal and compensation policy will have to state the rights of customers.
Source : http://goo.gl/D5YUXM