RBI Ombudsman scheme sees 32.81% surge in bank customer complaints to 9.34 lakh

A significant number of 85,281 complaints (as much as 29.01 per cent of the total complaints) with respect to loans and advances were received under the scheme, showing an increase of 42.70 per cent when compared to the previous year, the RBI said in its Annual Report on Ombudsman Scheme.

As many as 57,242 complaints (19.48 per cent of total complaints) pertained to mobile/ electronic banking, an increase of 32.61 per cent from the previous year. While 46,358 complaints (15.77 per cent) were about opening and operating deposit accounts, showing a rise of 34.45 per cent, it got 42,329 complaints (14.40 per cent) about credit cards, which showed a rise of 23.95 per cent over the previous year, the report said.

Chandigarh, NCT of Delhi, Rajasthan, Gujarat and Uttarakhand were the top five contributors to the complaints at the ORBIOs in terms of complaints received per lakh accounts (deposit and credit), while Mizoram, Nagaland, Ladakh, Manipur and Lakshadweep were the lowest contributors during FY 2023-24, the RBI report said.

During the course of the onsite examination of regulated entities (banks) for the period ended March 31, 2023, the Reserve Bank came across instances of lenders resorting to certain unfair practices in charging of interest. Some of the unfair practices were charging of interest from the date of sanction of loan or date of execution of loan agreement and not from the date of actual disbursement of the funds to the customer. Similarly, in the case of loans being disbursed by cheque, instances were observed where interest was charged from the date of the cheque whereas the cheque was handed over to the customer several days later.  In the case of disbursal or repayment of loans during the course of the month, some REs were charging interest for the entire month, rather than charging interest only for the period for which the loan was outstanding.

Customers complained about inaccurate or unauthorised charges on the customer’s statement, fraudulent activity, unsolicited issue of cards and disputes with merchants. Customers also complained about not receiving credit card rewards and promotional benefits and arbitrary changes in card norms.

The RBI Ombudsman report said a total of 934,355 complaints were received at the ORBIOs and the CRPC between April 1, 2023 and March 31, 2024, showing an increase of 32.81 per cent over the previous year. The complaints received at the ORBIOs increased by 25.24 per cent from 234,690 complaints in FY2023 to 293,924 complaints in FY2024, while those received at the CRPC increased by 36.59 per cent from 468,854 in FY2023 to 640,431 in FY2024.

The share of complaints from individuals in the total complaints was the highest at 256,527 (87.27 per cent) in FY 2023-24. Complaints against banks and NBFCs represented 82.28 per cent and 14.53 per cent of the total complaints respectively, the RBI report said.

It said a total of 284,355 complaints were disposed by the ORBIOs during the year, thereby achieving a disposal rate of 95.10 per cent. The ORBIOs disposed 192,886 complaints constituting 67.83 per cent of the total complaints as maintainable complaints, while remaining were disposed as non-maintainable complaints on certain grounds as per the RB-IOS, 2021.

As much as 57.07 per cent of the maintainable complaints were resolved through mutual settlement, conciliation or mediation while 40.78 per cent of the maintainable complaints were rejected on account of absence of any deficiency of service, it said.

CRPC witnessed a significant rise in complaints, receiving 766,957 complaints (including assigned to ORBIOs/ Consumer Education and Protection Cell), which was 30.10 per cent higher as compared to the previous year. Of these, 758,483 complaints were disposed at CRPC.

While 631,876 complaints were closed as non-complaints/ non-maintainable complaints, 126,607 complaints were assigned to ORBIOs/ CEPCs for further redress. Among non-maintainable complaints, 47.75 per cent complaints were closed as First Resort Complaints (i.e. complainant approaching directly RBI without first lodging complaint with the concerned RE) whereas 26.21 per cent complaints were closed because of being addressed to other authorities, the report said.

The RB-IOS was launched on November 12, 2021 and currently covers banks, NBFCs, payment system participants and credit information companies.

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COMPLAINTS                        Number                 % Change*

Loans & advances                       85,281                 42.70

Mobile/ electronic banking       57,242                  32.61

Opening/operating accounts    46,358                  34.45

Credit card                                    42,329                 23.95

ATM/ CDM/ debit card               25,231                 -15.70

*Over previous year

Source: RBI data