Banks must not classify customers' complaints as queries, says RBI

Central bank 'will not hesitate to act' against entities indulging in such behaviour, says deputy governor Swaminathan J

The Reserve Bank of India (RBI) has asked banks not to classify customer complaints as queries, saying the practice understates problems and could prompt it to take action.

The practice results in a false sense of complacency, Swaminathan J, deputy governor at RBI, told bank executives looking after customer complaints.

“We seek to disincentivise such practices and as a Regulator, we will not hesitate to act in case if it turns out to be an entity-wide behaviour. I, therefore, request the Customer Service Committees to keep a close watch and guard against such practices,” he said in a speech on September 21 that was released on Monday.

Swaminathan said the internal ombudsman (IO) framework in some banks is below requirements and it is not getting adequate importance from management. It is another area where the RBI would like customer service committees of bank boards to pay more attention.

The RBI launched the IO framework for banks in May 2015 and it was later extended to other regulated entities like non-banking financial companies, non-bank payment system participants and more recently to credit information companies. The framework’s intent is to enhance customer service.

“Another related aspect I would like to flag is complaints emanating from staff misbehaviour. While it may not be possible to fulfil the demands of your clients to their full satisfaction, no one has a right to behave badly with the customer," said Swaminathan.

Complaints about staff misbehaviour must be dealt with firmly and deterrent action must be initiated quickly, he added.