PSU banks score on customer care

Public sector banks have performed better than their private sector counterparts in customer service.

According to the latest data available for 2008-09, of the 69,117 complaints received at 15 banking ombudsman offices throughout the country, 32 per cent or 21,982 complaints were against private banks, which is higher than their market share of 18 per cent.

Private banks were followed by largest lender State Bank of India (SBI)and its associates. The SBI group, which comprises 24 per cent of the advances and deposits of banks in India, received 18,167 complaints, which is 26 per cent of the total complaints received by the banking ombudsman.
 

BANKING ON SERVICE
	No of complaints	In per cent	Market share
SBI	18,167	26	24
Other PSU banks	14,974	22	50
Private banks	21,982	32	18
Foreign banks	11,700	17	5
Rural/Coop banks	2,294	3	3

Foreign banks received 11,700 complaints (17 per cent) from customers with regard to deficiencies in their service, against their market share of 5 per cent.

The banking ombudsman received about one-fifth of the total complaints against the 20 nationalised banks, which comprise 50 per cent of the market. None of the nationalised banks figure in the top five against which the highest number of  complaints were received last year, whereas two leading foreign banks with a significantly lower market share are in the list. Among the individual banks, SBI tops with 18,167 complaints in the year, followed by ICICI Bank (11,453), HDFC Bank (6,584), HSBC (2,838) and Citibank (2,563).

If the total share of government-owned banks is considered, their share in total complaints is 48 per cent, as against their market share of 74 per cent. In contrast, private and foreign banks combined have 49 per cent share in complaints, with 23 per cent market share. The remaining 3 per cent of complaints are against regional, rural and cooperative banks, which have 3 per cent market share.

In the preceding three years (FY’06-08), 29 per cent of the complaints were against the SBI group, while 27 per cent were against other nationalised banks, followed by private (25 per cent) and foreign banks (11 per cent).

The data shows that complaints against all categories of banks have been showing a rise each year, of which over three times is for private banks and four times for foreign banks.

For an effective complaint redressal mechanism and to strengthen customer services in banks, the Reserve Bank of India in July issued a circular for a four-tier institutional arrangement consisting of  a committee of the board, standing committee of executives, a nodal department at the head office and controlling offices, and a committee at the branch level, for customer service.