While a good number of people generally state that they prefer to have their accounts in state-run banks, citing safety as the most important criteria, the banking regulator's findings reveal that customer service complaints against public sector banks have risen in 2010-11 as compared to those against private sector and foreign banks.
‘Customer satisfaction is an integral element in inculcating trust among the common people on the banking sector,' states the Report on Trend and Progress of Banking in India 2010-11.
Understanding the importance of customer service in banking, the RBI set up a separate customer service department in 2006 as also Banking Ombudsman (BO) offices in 15 major banking centres.
The BO has since proved to be a forum for redressing complaints received from customers.
According to the latest Trend and Progress report, the number of complaints received by the banking ombudsman has dipped in 2010-11 to 71,274 from 79,266 in 2009-10.
The decline in complaints has been more visible in the BO offices in Chennai, where it fell from 12,727 in 2009-10 to 7,668 in 2010-11, in New Delhi from 12,045 to 10,508 and in Mumbai from 10,058 to 7,566.
In the midst of this declining trend, Bhopal, Patna, Ahmedabad, Chandigarh and Guwahati reported an increase in the number of complaints.
The report further points out that the number of complaints per branch was high for foreign banks at 22.34, with almost a-fourth of the total received against credit/debit/ ATM cards.
The second largest number of complaints was with regard to pension followed by loans and advances.
More than 90 per cent of the total complaints relating to Direct Selling Agents (DSA) were received against foreign banks and new private banks in 2010-11 and 50 per cent (of the total complaints) related to hidden charges. Such complaints were found to be relatively less in public sector banks.
Pension-related complaints were instead quite high, accounting for almost 95 per cent of the total complaints, in public sector banks.
The RBI had constituted a Committee under the Chairmanship of the former Chairman of SEBI, Mr M. Damodaran, to examine banking services rendered to retail and small customers, including pensioners in 2010.
The Committee was also mandated to look into the grievance redressal mechanism prevalent in banks, suggest measures for expeditious resolution of complaints.
The committee interacted with various stakeholders on all aspects of customer service, including attitude of bank staff towards small and rural customers, service charges, transparency in operations, grievance redressal, customer rights and expectations, among others.
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