Visits to banks, physical presentation of documents can be avoided: Report

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Pressing on the physical visits, and physical presentations of documents to close bank accounts might get over if the Reserve Bank of India (RBI) decides to implement recommendations from a committee led by B P Kanungo, former deputy governor.

According to Economic Times, the report on the committee for review of customer service standards in RBI-regulated entities (REs), recommended that the insistence on physical visits, physical presentation of documents, etc must be avoided to the extent possible.

The report also suggested that REs may adopt Faceless/Straight Through Processes’ (STPs) in order to close accounts, and/or accept, acknowledge, and track the communication by the customer.

In a bid to facilitate hassle-free claim settlements in case of the death of the account holder, getting the nomination in deposit accounts may be made mandatory.

Citing the RBI report, ET said, "Obtaining nomination in deposit accounts may be made mandatory to facilitate hassle-free settlement of claims in case of death of the account holder" the report said. "Several existing accounts do not have nominations at present. The REs should be asked to obtain nominations in all such cases within a reasonable time period, say three years."

The committee also recommended that while the REs should be taking the required steps to update the Know Your Customer (KYC) process periodically, it must be ensured that operations in the account are not stopped. The pensioners should also be able to submit their Life Certificate (LC) at any branch of the bank in which they maintain their pension account.

The committee also recommended that Indian Banks' Association (IBA) will likely update its model operating procedure (MOP), keeping in line with the regulations to ensure hassle-free claims' settlement in accounts of the deceased account holders,

The committee was set up by the central bank following its announcement made in the monetary policy meeting of April 2022. It was set up to review the customer service standards in banks and Non-Bank Financial Companies (NBFCs).