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‘Banking complaints rose by 22% in FY21’

The banking regulator released the Annual Report of the Ombudsman Schemes for 2020-21 which has been prepared for the nine- month period from 1 July 2020 to 31 March 2021, in line with the change in RBI’s financial year from July-June to April-March.Premium
The banking regulator released the Annual Report of the Ombudsman Schemes for 2020-21 which has been prepared for the nine- month period from 1 July 2020 to 31 March 2021, in line with the change in RBI’s financial year from July-June to April-March.

  • Banking Ombudsman accounted for 90.13% of complaints whereas OSNBFC accounted for 8.89% and OSDT accounted for 0.97% of the complaints during FY21

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MUMBAI : The Reserve Bank of India saw a 22.3% jump in consumer complaints under the various Ombudsman schemes for the fiscal year 2020-21, bulk of them related to debit cards, online banking and credit cards. 

The banking regulator released the Annual Report of the Ombudsman Schemes for 2020-21 which has been prepared for the nine- month period from 1 July 2020 to 31 March 2021, in line with the change in RBI’s financial year from July-June to April-March. 

The Annual report covers the activities under the Banking Ombudsman Scheme, Ombudsman Scheme for non-banking financial companies (OSNBFC) and Ombudsman Scheme for Digital Transactions (OSDT) 

Banking Ombudsman accounted for 90.13% of complaints whereas OSNBFC accounted for 8.89% and OSDT accounted for 0.97% of the complaints during FY21.  

The banking ombudsman for instance received 2.73 lakh complaints during FY21, lower than 3.08 lakh complaints received during the previous year. The complaints related to ATM/debit cards transactions, mobile and electronic banking and credit cards accounted for 42.7% during the fiscal year 2020-21 compared to 44.65% in the previous year.  

OSNBFC on the other hand, saw a 38.7% jump in complaints, having received 26,957 complaints during the FY21 compared to 19,432 complaints in the previous year.  

Under OSNBC, majority of the complaints related to non-adherence to FPC, non-observance to RBI directions and levy of charges without notice accounting for 75.32% of the complaints as compared to 63.23% in the previous year. 

“The disposal rate improved significantly from 92.36% during July 1, 2019 to June 30, 2020 to 96.67% during July 1, 2020 to March 31, 2021, a five-year high, despite the volume of complaints handled being higher than the previous year on an annualized basis, and the human resources remaining the same, which can be attributed to end to-end digitization of complaint processing in CMS," said RBI in its report. 

During FY21, complaints related to fund transfers/ UPI/ BBPS/ Bharat QR code constituted the largest share accounted for 51.15% of the total complaints received, followed by mobile/electronic fund transfers / mobile/electronic banking at 22.57% and non-reversal of funds due to wrong beneficiary transfer by System Participants at 8.18%. 

Of the total maintainable complaints, 73.69% were resolved through mutual settlement/ agreement i.e. through intervention of the ONBFCOs, conciliation/ mediation. 

RBI plans to improve grievance redressal mechanism by enhancing CMS capabilities and undertaking annual assessment of banks under the framework. 

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