Two bankers start a website to draw the common man into talking money and help him understand the basics of banking
Most people would have problems locating their bank statements even if they were handed a shovel and a magnifying glass. A greater number would scoff when Sujit Guha and Gautam Majumdar say banks are pleasant places where every senior citizen is offered a chair and a glass of water. Have they confused banks with hotels? They insist theyre speaking from inside experience. Guha was manager at various branches of the State Bank of India for 35 years while Majumdar,now a writer and consultant,was with UCO Bank for more than two decades.
Four months ago,they put their combined knowledge into a website (www.trustbanking.org.in),to draw the common man into talking money by understanding the gritty details of banking.
Unlike in the West,where even teenagers are money smart,Indians are largely financially illiterate, says Guha. Even smart,young professionals generally restrict their banking to the ATM. They wouldnt realise it if a bank goofed up, adds Majumdar. One of his relatives learnt this the hard way when her bank wrongly sent an outstation cheque for local clearance. The bank not only failed to clear her cheque,causing her to lose interest on it for 15 days,but also deducted Rs 75 as returning charges. Such errors happen all too often,but 75 per cent of bank customers do not keep track, he says.
It isnt only fear of numbers that makes one postpone the bank visit,there are also the serpentine queues. How many people know that the RBI has benchmarked the time needed for a bank to render particular services? asks Majumdar before rattling off the numbers. Fifteen minutes for encashment of cheques,30 minutes for getting a demand draft.
The website,which looks at banking from a laymans perspective,includes sections on features of a cheque,credit and debit cards,basics of a bank loan and idle funds. Guha adds that it is a common practice to keep excess funds in the savings account,especially by the elderly. Imagine the huge loss of interest. I advise them to leave funds for exigencies and transfer the rest into a fixed deposit account. As the site details,the sweep account is another alternative. These are savings accounts linked to fixed deposit accounts. Any excess fund above a certain threshold gets automatically transferred to a fixed deposit account,doing away with the problem of idle money, he adds.
The site has attracted an encouraging number of hits and among the popular sections is the chart listing the interest rates being offered by various banks. Thus,while SBI offers 4.5 per cent interest per annum on a 15-45 day deposit,the Punjab National Bank quotes a 4.75 per cent for the same duration. Most people assume that all banks offer the same rate of interest, says Majumdar. The chart is updates regularly and comparative figures are there at a glance,enabling one to decide on the bank where a deposit can earn the highest amount.
This is particularly necessary at times of economic slowdown when everybody wants their savings to go the extra mile, he adds. According to the bankers,the ultimate harakiri is to maintain an inoperative accountaccounts that have not been visited for two years. Quoting RBI figures,they say there is a whopping Rs 1,200 crore lying in inoperative accounts of various banks. The scary part isnt that these funds may is lying idle,it is that these accounts invite fraud. Most banking frauds have insider help. Whats stopping an employee from faking a signature,since he is sure it will never be detected? It is important to visit banks to update ones passbook regularly and operate the account, he says.