Introduction:It
is said that Banks exist, survive, thrive and flourish because customers
patronize them by keeping deposits with banks and availing loans and other
services from the banks. Introduction of many types of private banks and
technology based processes, products and services in banking arena have intensified
tough competition among the banks in our country. A customer is now not loyal
to a particular bank. Many customers now maintain accounts with more than one
bank and avail different kinds of services from at least two-three banks. ‘Competition’
is the name of the game in the banking industry at present and for this reason
‘customer service’ has assumed greater significance in today’s banking across
the nation and world over because customer service is now directly linked with
business development in banks in the liberal market economy and technology based
banking.
Gandhiji & Customer
Service:Long back Father of the Nation Mahatma Gandhi
said, “A customer is the most important visitor in our premises. He is not
dependent on us. We are dependent on him. He is not interruption in our work.
He is the purpose of it. He is not an outsider to our business. He is part of
it. We are not doing him a favour by serving him. He is doing us a favour by
giving us the opportunity to do so.”
Hearing
the words of Gandhiji, the Bankers can visualize and realise the importance of
customers in their banks. If the employees of a bank can internalize the
concept of ‘customer’ as enunciated by Gandhiji in the right perspective, they
will be motivated to serve customers better and better.
Why Customers get dissatisfied:If
bankers want to formulate a plan of actions for better customer service, they
first must know why customers get dissatisfied. The customers get dissatisfied
for the following reasons: 1) Customers
are roaming in the branch without being noticed and responded, 2) Customers have to chase up
employees almost all the time for getting work done, 3) Customers are kept waiting for a tiny work even!, 4) Making inordinate delay for sanction
& disbursement of loans, 5)
Employees /Managers not returning telephone calls, 6) Employees/Managers are not taking ownership of the problems, 7) Poor communication in regard to
mistakes and problems from Bank side, 8)
Rigid, inflexible procedure of the bank, 9)
The Bank is not having enough technological and other products and services, 10) The Bank is giving low rate of
interest on deposits and charging high rate of interest on loans &
advances. The Bank is charging service charges at exorbitant rates.
The
dissatisfied customers can do enormous damaged to a bank. Most of the
dissatisfied customers will tell others about their negative experiences with a
bank. Thus, they will damage reputation of a bank in the market. The
dissatisfied customers will silently move out of the bank by closing their
accounts and provoke others to do so.
Technology based customer
service:In the present day world, with the advent of
state of the art technology, customer service has improved significantly across
the service industry including in banking. Mobile banking and internet banking
have enabled Individual consumers and businessmen to carry out banking
transactions and to avail so many banking and financial services from the
comforts of homes & offices with ease, safely and securely and in a very
fast manner. UPI has enabled to make and receive small payments online in
seconds making it almost redundant to carry cash in wallet. The customers
very rarely visit bank branches now especially new generation young customers.
But with proliferation of technology, on-line frauds have also proliferated for
which the customers must be very careful and should not part with or share OTP,
Password, CVV etc with others.
Why Excellent customer service
is needed in banks: In the modern banking world,
customers’ expectations have increased and customers have become more
knowledgeable, demanding and discerning. Some customers are sensitive enough to
change allegiance at the slightest dissatisfaction in customer service. The
reality is that every bank is alluring remunerative customers constantly. So,
it is rightly said that ‘Excellent customer service’ is the need of the hour in
the banks.
How Excellent Customer service
can be practiced in Banks:The following points will
highlight how we can improve customer service in banks: 1) Employees have to have open mind and not prejudiced towards
customers, 2) Employees have to have
good self-esteem. They should provide selfless service to the customers, 3) Employees will have to be
approachable and well mannered, 4)
Employees will have to greet customers with smile, eye-contact and handshake or
namaskar, 5) The management must
ensure nice branch ambience. The Branch must be neat, clean and modern looking and
should have proper waiting lobby and drinking water and wash room facility etc,
for customers, 6)Customer-friendly
and technology based products & services must be introduced at regular
intervals in banks. Interest rates on both deposits and loans must be reasonable
and market driven and service charges must also be reasonable and are not out
of line with the average cost of providing these services. Products and
services features may be displayed neatly and prominently in the branch
premises, 7) Adequate brochures/leaflets
in regard to products & services must be maintained at the branches for
distribution to the existing and prospective customers, 8) Employees must have good body language and presentable
appearance. Employees must come to office well dressed and well groomed, 9) Employees must have positive
attitude and should always see the bright side of an event or person, 10) Customers’ needs must be listened
to carefully and empathetically and the service should be given accurately and
timely, 11) Employees must remain
updated with knowledge of products, processes and services and must entertain
the customers properly, 12)
Employees should have excellent communication skill and should give service to
the customers pro-actively, 13)
Employees should be tactful, helpful and cool-headed and should not be agitated by the provocation of
any customer, 14) The Bank must
delight the customers by giving something extra beyond expectation, 15) If the interest paid on deposit
accounts and or interest charged on loan accounts, is not accurate or any other
service deficiency is there, the refund
must be given and deficiency must be rectified immediately on detection or
demanded by the customer whichever is earlier before the customer goes to RBI
ombudsman.
PNB’s new MD emphasizes
customer service: The country’s second largest public
sector Bank’s new MD & CEO Mr. Ashok Chandra isset to step up its focus on
customer service who is working with his team to deploy a QR code based
feedback system for all customer facing-employees with each staff member
required to receive at least 50 such reviews. Customer feedback will be part of
the annual assessment of each employee.
RBI Ombudsman:An
RBI Ombudsman is a senior official of RBI appointed by RBI to redress the complaints
from customers of the Regulated Entities (Banks, NBFCs etc) against ‘deficiency
in service’ as defined under clause 3(1) (g) of the RB – IOS,2021. ‘Deficiency in
service’means a shortcoming or inadequacy in any financial service or such
other services related thereto, which the Regulated Entity is required to
provide statutorily or otherwise, which may or may not result in financial loss
or damage to the customer.
The
following Regulated Entities are covered under RBI Ombudsman Scheme: 1) Banks: All Commercial Banks
including Public Sector Banks, Private Sector Banks, Foreign Banks, Local Area
Banks, Small Finance Banks, Payment Banks, Regional Rural Banks, Scheduled Primary
(Urban) Co-operative Banks and non-scheduled Primary (Urban) Co-operative Banks
with deposit size of Rs50Crore and above as on the date of Audited Balance
Sheet of the previous financial year. 2)
NBFCs registered with RBI: All Non-Banking Financial Companies (excluding
Housing Finance Companies) which (a)are
authorised to accept deposits or (b)
have customer interface with an asset size of Rs100Crore and above as on the
date of Audited Balance Sheet of the previous financial year. 3) System Participants: All payment
system participants – banks & non-banks regulated by RBI are covered under
the RBI-IOS, 2021 who facilitate NEFT/RTGS/UPI etc. 4) Credit Information Companies: All Credit Information Companies
registered with RBI.
Grievance Redressal Mechanism:For
grievance redressal, a complainant must first approach the Regulated Entity
(Banks etc). If the RE does not reply with 30 days or rejects the complaint
wholly or partly or the complainant is not satisfied with the reply given by
the RE, the complainant can lodge his complaint with RBI under RBI’s Integrated
Ombudsman Scheme (RB – IOS, 2021). All complaints involving ‘deficiency in
service’ on the part of Regulated Entity are covered except some as available
in RBI website as FAQs on ‘The Reserve Bank – Integrated Ombudsman Scheme,
2021’dt 07.01.2025.
The
Regulated Entity shall appoint a principal nodal officer at their Head Office
who shall not be in a rank less than a General Manager who will deal with all
matters related to complaint to RBI Ombudsman. The Regulated entity shall
display at branches, names and contact details of (phone number and E-mail ID)
the bank’s Principal Nodal Officer along with address of RBI Ombudsman’s
complain lodging portal (https://cms.rbi.org.in).
The Regulated Entity shall ensure that salient features of the ombudsman scheme
are displayed prominently in the branches in English, Hindi & in local
language. A copy of the scheme should also be kept in the branches to present
before the customer if he or she wants to see it. The salient features of the
scheme along with the copy of the scheme and the name and contact details of
the Principal Nodal Officer shall be displayed and updated on the website of
the Regulated Entity.
Fraudulent transactions through
electronic and digital banking: In regard to
losses from fraudulent transactions through electronic and digital banking,
Customers must report to the Bank immediately after noticing any unauthorised
transactions in their accounts. Delay in reporting reduces their chance of
getting the money back. As per RBI Circular on Limiting Liability of Customers
in Unauthorised Electronic Banking Transactions dt July 06, 2017, zero
liability of the customer shall arise if i)
contributory fraud/negligence/deficiency is there on the part of the bank ( irrespective
of whether or not the transaction is reported by the customer). ii) Third party breach where the
deficiency lies neither with the bank nor with the customer but lies elsewhere
in the system and the customer notifies the bank within three working days of
receiving the communication from the bank regarding the unauthorised
transaction. A customer shall be liable for the loss occurring due to
unauthorised transaction in the following cases i) In cases where the loss is due to negligence by a customer, such
as where he/she has shared the payment credentials, the customer will bear the
entire loss until the unauthorised transaction was reported to the bank. Any
loss occurring after the reporting of the unauthorised transaction shall be
borne by the bank. ii) In case where
the responsibility for the unauthorised electronic banking transactions lies
neither with the bank nor with the customer but lies elsewhere in the system
and when there is a delay (of four to seven working days after receiving the
communication from the bank) on the part of the customer in notifying the bank
of such a transaction, the per transaction liability of the customer shall be
limited as given in the circular.
Internal Ombudsman Scheme:
Besides, RBI has issued circular on ‘Internal Ombudsman for Banks (Circular:
RBI/ CEPD/2023-24/108 dt 29.12.2023) according to which every scheduled
commercial bank, NBFC, Non-Bank System Participants and Credit Information
Companies should employ one Internal
Ombudsman with a view to strengthen the Internal Grievance Redressal System of
the Regulated Entities.
RBI Master Circular on Customer
service at Banks: Moreover, RBI also issued a
comprehensive Master circular on ‘Customer Service of Banks’ (Circular: RBI
2015-16 /59 dt 01.07.2-015) in which service standard and norms in regard to
every service has been specified to be followed by the banks.
From
the above, it is very much evident that RBI attaches great importance on
customer service of the Banks. RBI Governor recently said in a conference, “we
stand at a pivotal juncture as India looks to realise its dream of a more
resilient and inclusive Viksit Bharat. With the financial sector touching the
lives of almost the entire population, we have a critical role. To succeed in
this role, we must continue to enhance customer service and customer
protection.”
Conclusion:
Excellent customer service is the urgent need of the hour because it helps to
develop trust in the minds of customers towards the bank, enhances and deepens
customer satisfaction and gives rise to perpetual loyalty. All these positive
vibes continuously spread through word of mouth publicity and lead to bank’s
reputation to reach greater heights in the course of time. The result is more
and more happy customers and shareholders are attracted towards the bank which
pushes up the quality topline (business) and helps bank to achieve the enviable
bottom line (profit)of the bank.
