Consumer Protection In Banks

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Indian Constitution has passed the consumer protection act 1986 , to protect the interest of the consumers and to provide themRight to safety Right to information Right to choice Right to be heard The right to redress The right to consumer education

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8/19/12

Applicability of the act in Banks
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According to section consumer protection Act, includes a person who hires or avails of any service for a consideration. Thus, a customer of a bank who has a bank account with the bank A person who purchases a bank draft, Hires locker facility Obtains bank guarantee from a bank

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They are all “consumers "and can prefer complaints under the Act for “deficiency in service” on the part of 8/19/12 the bank or for “restrictive trade practice” or “unfair

RBI has segmented to protect the consumer in Banks in 8 categoriesv v v v v v v Deposit Accounts Building of productsInoperative AccountsMinimum BalanceSavings bank accountKnow Your Customer (KYC) Norms Term Deposits 8/19/12 .

v v Remittances Students who makes frequent payments of small amounts related to fees for their college fees and all such fees are generally made through Demand Drafts (DD). Students who do not have bank accounts face difficulty in obtaining drafts for these purposes. Travel Visa fee payable at Banks Penalty for Returned Cheque Automatic cheque drop facility v v v v v Loans & advances Time Schedule for disposing of Loan Application- 8/19/12 .

§ ü § § Institutional Arrangements Banking codes and standard board of India Code of Bank’s Commitment to Customers-2006 Code of Bank’s Commitment to Micro and Small Enterprises-2008 fair treatments to customers Minimum courtesy and behavioural standards  Transparency  Non-discriminatory policy ü q § § 8/19/12 .

Other Aspects Approach and Attitude to Customer Service: § 8/19/12 ü . RBI Act 1935. IT Act 2000. Indian Limitation Act 1963. etc. Banking Regulation Act 1949.§ § Comprehensive Banking Regulation banking gets its legal basis from a host of Acts codified under different enactments like Indian Contract Act 1872. Indian Stamp Act 1899. Negotiable Instruments Act 1881.

ü ü ü ü Reimbursement in case of Frauds Empowering Disabled Persons Customer Service Departments of Banks (CSD) Information on Fraudulent Accounts 8/19/12 .

egs Electronic fund transfer § § RTGS NEFT Direct debits(ecs) Direct credits 8/19/12 .Technology in banks Electronic payment system .A means of making payment over an electronic network such as the internet.

2004 RBI would recover Rs. 8/19/12 .25 for each transactions but banks will have their own charges to vary from bank to bank § § § About 3000 branches at 275 locations in India meet this criterion.RTGS § The acronym “RTGS” refers to for Real Time Gross Settlement. it is a unique and popular fund transfer mechanism which enables the transfer of money between two banks on a “real time” and on “gross” basis The system was launched on March 26.

This system was introduced in 2005 and is highly improved version of EFT (Electronic Funds Transfer) which was confined to a select centre.NEFT § “NEFT” is the abbreviation for National Electronic Funds Transfer which is an online system for transferring funds between financial institutions.000 then they charge Rs 2.50 § § 8/19/12 . Transaction below 2 Lakhs is done thru NEFT Rs 5 charged per transaction and if the transaction value is less than 10.

AUTOMATED TELLER MANAGEMENT (ATM) v v You can withdraw you money anytime They are located outside the bank hall for with drawers of cash They listen and follow instructions from the host These save time and involves less paperwork They operate 24hours These use pin for security v v v v 8/19/12 .

Mobile Banking Account Information q Payments & Transfers q Mini-statements and checking of account history Alerts on account activity or passing of set thresholds Monitoring of term deposits Access to loan statements Access to card Domestic and international fund transfers Micro-payment handling Mobile recharging Commercial payment processing Bill payment processing q q q q q q q q 8/19/12 Investments .

Gives you the option of handling q q q 8/19/12 .Internet Banking Advantages q q very convenient allow you to pay your bills and make transactions anytime during the day and the week. So. no matter in which country you are anywhere in the world. The bank will never close because you can access it through your laptop or computer. you can go online and handle your finances.

Anywhere banking It the process by which customers transact from any branch in India Centralized banking 8/19/12 .

Overseas Expansion – An Initiative § § Tap growth in international trade Focus on increasing presence in international markets 8/19/12 .

Rapid expansion of Indian Banks on international front took place during 1976-1984 Slow down of expansion during 1985-1987 Narrow international spread. § § § 8/19/12 .History of Overseas Expansion of Indian Banks § Overseas business of Indian Banking dates back to 1921.

Recent Developments in Overseas Expansion § As on O ctober 2005. 14 Indian Banks had operations spread across 42 countries SBI announced 51% stake in IOIB in early February 2005 PNB opening more overseas branches Bank of Baroda’s wide overseas presence. § § § 8/19/12 .

Inherent INTERNAL § Insufficiency in capital for setting up overseas operation Operations confined No advancements Resistance from RBI US Debt and Euro Zone crisis Competitive Global environment § § § EXTERNAL § § 8/19/12 .

Gearing Up for the Future § Finance Ministry influencing PSBs to spread overseas 7 banks to lead the expansion drive Ministry to support banks § § 8/19/12 .

Working with other divisions such as Legal and Compliance to help set company rules and sometimes communicate those rules to staff Ensuring employees are treated fairly. This includes things like: v Making sure the business employs the best people. aware about their rights and that there are measures in place when something goes wrong Help to develop ‘people strategies’ to meet the goals of different parts of the business 8/19/12 v v v .HR is responsible for people issues across the whole company. develop them and ensure they don’t leave.

Roles of HR in banking: v v v v Contribution of HR Development in Bank Reform Changing Nature of the Banking Industry Talent & Recruitment Creating Strategic Leadership 8/19/12 .

Relating Pay to Performance Changing Culture Changing Role of Personnel and Line Managers 8/19/12 .New Practices towards HRM: v v v v v Industrial Relations Cost Control Remuneration .

Elements of HRM: v v v v v v Recruitment & Selection Training & Development Performance appraisal Promotion Compensation Employer-Employee relationship 8/19/12 .

Main sub-areas of HR v v v v v Recruitment / resourcing / talent acquisition Development Reward or compensation and benefits Employee relations Business partners / strategic partners / HR advisor 8/19/12 .

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