New Delhi: Reserve Bank of India (RBI) has advised banks to take steps to ensure that customers are made aware of the service charges upfront and changes in the service charges are implemented only with the prior notice to the customers.
RBI has listed action points for banks to ensure fair practices in banking services on the basis of the Working Group report to formulate a scheme for ensuring reasonableness of bank charges.
Further, full-fledged information on bank products and their implications are to be disclosed to the customers so that the customers can make an informed judgement about their choice of products, the apex bank stated.
Banks have been advised to identify the basic banking services on the basis of broad parameters indicated by the Working Group.
The working group states that services that are ordinarily availed by individuals in the middle and lower segments, will be the first parameter.
These will comprise services related to deposit/loan accounts, remittance services and collection services. When these transactions occur in different delivery channels, for the purpose of pricing, they may be treated on a separate footing.
However, the list is indicative in nature and banks may, at their discretion, include additional services as they may consider appropriate, RBI said.
Some of the banks do not levy charges on each individual product or service. Products and services are bundled and offered to a customer as a composite offering.
For basic services, RBI has advised banks to ensure that these are made available to users at reasonable prices and towards this, the basic services should be delivered outside the scope of the bundled products.
Banks will without fail inform customers in all cases when a transaction initiated by the bank itself results in or is likely to lead to a shortfall in the minimum balance require to be maintained.
For basic services to individuals, the charges should be lower than the rates applied when the same services are given to non-individuals. For customers in rural areas, pensioners and senior citizens, banks will levy charges on more liberal terms, the working group has suggested.
For grievance redressal, banks should have robust grievance redressal structure and processes to ensure prompt in-house redressal of customer complaints.