04, Sep 2018
Prelims level : Indian Economy Mains level : Paper – II Governance
- RBI introduces Internal Ombudsman Scheme for stronger redressal of banks customer complaints.
- The banking regulator has asked all the Scheduled Commercial Banks having 10 or more banking outlets to have an independent internal ombudsman (IO) to review customer complaints that are either partly or fully rejected by the
- The IO mechanism was set up with a view to strengthen the internal grievance redressal system of banks and ensure the complaints of the customers are redressed at the level of the bank As banks should internally escalate complaints that are not fully redressed
to their respective IOs before conveying the final decision to the complainant, customers need not approach the IO directly.
- The implementation of IO Scheme, 2018 will be monitored by the bank’s internal audit
mechanism apart from regulatory oversight by RBI.
- The Scheme covers appointment/tenure, roles, and responsibilities, procedural guidelines and oversight mechanism for the IO, among other
- The Banking Ombudsman is a senior official appointed to redress customer complaints against deficiency in certain banking
- It provides a forum to bank customers to seek redressal of their most common complaints against banks, including those relating to credit cards, service charges, promises given by the sales agents of banks, but not kept by banks, as also, delays in delivery of bank services. The bank customers would now be able to complain about non-payment or any inordinate delay in payments or collection of cheques towards bills or remittances by banks, as also non-acceptance of small denomination notes and coins or charging of commission for acceptance of small denomination notes and coins by
- The Banking Ombudsman Scheme is introduced under Section 35 A of the Banking Regulation Act, 1949 by RBI with effect from
- One can file a complaint before the Banking Ombudsman if the reply is not received from the bank within a period of one month after the bank concerned has received one’s complaint, or the bank rejects the complaint, or if the complainant is not satisfied with the reply given by the
- Any person aggrieved by an Award issued under Clause 12 or the decision of the Banking Ombudsman rejecting the complaint for the reasons specified Clause 13 of the Banking Ombudsman Scheme 2006 can approach the Appellate Authority. The Appellate Authority is vested with a Deputy Governor of the
- One can file the appeal against the award or decision of the Banking Ombudsman rejecting the complaint within 30 days of the date of receipt of the Award, The Appellate Authority may, if he/ she is satisfied that the applicant had sufficient cause for not making an application for appeal within time, also allow a further period not exceeding 30