RBI panel suggests a host of customer-centric initiatives for banks

MUMBAI: An RBI-appointed panel on Monday recommended hosts of customer-centric initiatives for banks, including online settlement of claims by heirs of deceased account holders, flexibility for submission of life certificates by pensioners and a centralised KYC database.

The report of the Committee for Review of Customer Service Standards in RBI Regulated Entities (REs) has also suggested that the operations of accounts should not be stopped pending periodic Know Your Customer (KYC) updates.

It recommended that there should be a time limit for the return of property documents to borrowers after the closure of the loan account, failing which a penalty should be imposed on the lender.

In case of loss of property documents, the RE should not only be obligated to assist in obtaining certified registered copies of documents at their cost but also compensate the customer adequately, keeping in view the time taken to arrange the alternate copies of the documents, the report said.

In May last year, the Reserve Bank set up the committee under former RBI Deputy Governor BP Kanungo.

The committee reviewed the complaints received under the RE's Internal Grievance Redress (IGR) mechanism in the last three years and observed that the number of complaints has been range-bound in the region of around one crore complaints per annum, the report said.

The REs, it suggested, ''may adopt a nuanced approach for risk categorisation of the customers. For example, salary earners with inflows and outflows consistent with the customer's profile need not necessarily be categorised as high risk, even though they may be 'high net worth' individuals''. Similarly, students can also be categorised as low-risk.

The report said till the recommendation for a common complaint portal is put in place, the REs should have a system to enable the complainant to track the progress in the processing of the complaint.

''Customer-facing staff and officers should undergo mandatory training in soft skills to reduce instances of misbehaviour by the errant staff/officers,'' it said. The committee has also suggested measures for the benefit of pensioners.

The pensioners, it said, should be able to submit Life Certificate (LC) at any branch of the bank in which they maintain their pension account. Moreover, they should be allowed to submit LC in any month of their choice to avoid the rush in a particular month, and subsequent LCs can be submitted in the same month at annual intervals, it added.

The committee has made recommendations covering regulatory, RE conduct and technology aspects for strengthening customer service in REs, which include banks, NBFCs, small finance banks, cooperative banks and payment banks.