Banking
HDFC Bank takes 15 days, two visits and 15 calls to credit eight paisa!

In a clarification, HDFC Bank told the RBI that since it could not get details from seven complainants out of 12, it could not resolve their grievances. However, one of the complainant left out by HDFC Bank spent Rs36 for over 15 days by making two visits to the Branch and 15 calls to retrieve his eight paisa

In April, Moneylife wrote about how customers of HDFC Bank were being harassed  with its new know your customer (KYC) norms. Several people shared their experiences with us. Moneylife followed up with HDFC Bank and the Reserve Bank of India. Taking cognisance of the issue, RBI issued a notice to HDFC Bank seeking clarification. The Bank sent its reply to the RBI, however, stated that it could not get details from seven customers out of 12, including Avinash Murkute and hence, was not able to resolve these customers’ problems.

 

Mr Murkute says, “It is shocking that the signatory to clarification letter from HDFC Bank (to the Reserve Bank of India- RBI) has mentioned that I have not provided account details. How and why one shall provide his account numbers of closed accounts? One Madhurima Manmohandas of HDFC Bank did write and ordered me in June 2013, to provide my account number within seven days. If it had been a polite request, I would have responded to her in equally polite manner. This demonstrated how serious HDFC was in responding to the RBI. When they (HDFC Bank) cannot read letters by speed post and require 15 days to refund 8 paisa, why should one respond to the order from HDFC Bank?”

Here is the first person account from Mr Murkute about his dealings with HDFC Bank…

 

 

I have abandoned and deserted HDFC Bank and included them in the list of defaulter’s as they still owe me Rs36.00 towards cost of recovering 0.8 paisa from the Bank in a case where cheque was deposited of RsXXXXX.08 and credit was given of RsXXXXX.00 only. This was violation banking double entry accounting mechanism and provisions. The Bank and its Kothrud, Pune branch and branch manager took 15 days and two personal visits by me and 15 phone calls to their centre of excellence and state of the art customer (harassment) call centre and equally harassing grievance resolution nodal officers and appellate authority to credit the eight paisa in my account.

 

I have closed all my four accounts including demat account way back in 2009 and I have obtained closure confirmation letter of each account. For closure of demat account, they made me oscillate from one office to another like Bank, Branch, HDFC Securities and so on. What was given in writing by HDFC Bank’s corporate office was not acceptable to branches. What is more interesting that even the vice president of HDFC Bank for depository operations, named R Venugopalan (my record reference No.339/HDFC/ Depository Date: May 26, 2009) doesn't read and respond to written communications.

 

Many times, they refused to print entries in my passbook on flimsy grounds. At times, they insisted that new account should be opened through agents only.

 

In spite of my number 9********9 is included in do-not-disturb (DND) list, HDFC keeps  calling me several times for opening demat account,  deposit account, car loans, home loans Every time protest was lodged with HDFC’s corporate office and every time they replied that this will not happen again but (the calls) still continuing. Every time they advise me register separately with each office and each branch of HDFC. This is in violation of national DND which HDFC never respected.

 

Once HDFC Bank gave me a double credit of Rs160 due to human error. I was quick to point this to them, and then they adjusted this additional credit of Rs160 by debiting from my account. HDFC Bank should learn this sense of urgency and honesty and its training managers should try to impart to its senior management so that ground realities can improve.

 

In the year 2009, I could have eaten six Vada pavs and HDFC Bank have deprived of my six vada pavs ( Rs36.00) and the chief managing director of the Bank should be made to understood this agony. If RBI would like a written complaint and / or more information, they can take this as feedback for the same. Everybody gets a chance to be equal.

User

COMMENTS

TIHARwale

4 years ago

In line with HDFC focus and commitment to Customer Service, we trust that this Grievance Redressal Cell has addressed your grievance in a fair and equitable manner and the issue has been resolved to your satisfaction. If you are not satisfied with the resolution, you may write to our Principal Nodal Officer Mr. RatanKumar Kesh at HDFC Bank Ltd., Trade World, “C” Wing, 11th Floor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai-400013 or E-mail at pnohdfcbank@hdfcbank.com or Fax at 022-42197125. Alternately you can call at Tel: 022-30961541.

Shashibhushan Gokhale

4 years ago

I have a feeling that these type of problems are faced in each and every bank. I am curious to know the bank and branch that Mr. Murkute have chosen after closing his accounts in HDFC Bank, Kothrud branch.

Mr. Murkute, can you please reply? I would like to get your feedback about your experience with your new banker.

Shashibhushan Gokhale

4 years ago

Its not the staff but the management that creates the pain and pleasure framework/culture which drives the staff. If branch manager or VP is serious enough and shows it with actions, staff would automatically be alert to avoid escalations next time.

Suiketu Shah

4 years ago

Staff of bank to be blamed not the management as its the staff in such institutions who work against the interest fo the management and bank by harming customers.Bank shd throw away such rotton staff responsible for this immedaitely.

Nationalised banks write off Rs14,549 crore in March quarter

During the last quarter of FY13, public sector banks wrote off Rs14,549 crore as loans and recovered Rs16,464 core from assets that turned bad

Public sector banks (PSB) or state-run lenders wrote off Rs14,549 crore as loans, while recovering Rs16,464 crore from assets that turned bad during the March quarter.

 

In a written reply in Lok Sabha, minister of state for finance Namo Narain Meena said, “Banks resort to write off only after exhausting all other possible avenues for recovery or when the asset coverage is not enough”.

 

He further said that banks are required to adhere to Reserve Bank of India (RBI) guidelines on write offs as well its board approved policy.

 

“The banks should either make full provision as per the guidelines or write-off such advances and claim such tax benefits as are applicable,” the minister said.

 

In reply to a separate question on long term capital need of the banks, the Minister said that the government is considering setting up a holding company to meet these requirements.

 

“To meet the long-term needs of capital of PSBs, the government in consultation with Reserve Bank of India, is considering formation of holding company.

 

The matter is under consultation with Department of Legal Affairs and Legislative Department,” Meena said.

 

The public sector banks need capitalisation to meet their enhanced lending, which is increasing every year. This fiscal, the government has made provisions of Rs14,000 crore for bank recapitalisation.

User

COMMENTS

RAJ

4 years ago

ONCE UPON A TIME BANK EMPLOYEES WERE PAID HIGH. NOW IN BOTTOM AND LEAST PAID. ONCE IN 5 YEARS IBA AGREES TO PAY ONLY 8 TO 10 % INCREASE. WHEREAS VI PAY COMMISSION GRANTED 50 TO 60% INCREASE TO GOVT EMPLOYEES. EXAMPLE: Nationalised banks write off Rs14,549 crore in March 2013 quarter. BANKS HAVE GOT MONEY TO WRITE OFF EVERY YEAR IN 5 DIGIT CRORES BUT THEY DO NOT HAVE MONEY TO PAY ITS EMPLOYEES WHICH AMOUNTS TO 3 DIGIT CRORES EVERY YEAR

RAJ

4 years ago

IT'S PAINFUL TO KNOW THAT public sector banks wrote off Rs14,549 crore as loans During the last quarter of FY13. It's all the hard earned money of income tax payers which are being used to write off loans and waiver of interest and giving subsidies. Why should you give loans without proper security. Most of these write offs are the result of giving loans to farmers under various schemes. BORROWERS COME TO BANK WHEN EVER MINISTERS SAY THAT LOANS TO FARMERS WILL BE WRITTEN-OFF. WHAT RIGHT MINISTERS HAVE TO WRITE-OFF LOANS? MORE LOOP HOLES GIVEN FOR BUSINESS CLASS, BUREAUCRATS AND GIVING EXEMPTIONS IN INCOMETAX. Hard earned money of income tax paid by govt and public sector employees are mis-used by the government by way NATIONAL RURAL EMPLOYMENT SCHEME LIKE NREGA, MREGA,ETC WHERE MONEY IS BEING LOOTED BY THE MINISTERS AND GRAM PANCHAYAT OFFICES. UNDER THE SCHEMES, THE GRAM PANCHAYAT CONTRACTORS SELECT CERTAIN CUSTOMERS WHOSE ACCOUNTS ARE IN-OPERATIVE AND MAKE THAT OPERATIVE TO GET NREGA ETC FUNDS BY CLAIMING THAT THE VILLAGERS ARE PAID FOR CLEANING DRAINAGE AND SWEEPING ROADS WHICH ARE ACTUALLY NOT DONE AT ALL. THE AMOUNT SO CREDITED TO VILLAGERS ACCOUNTS ARE WITHDRAWN BY THE ACCOUNT HOLDERS AND THE CONTRACTORS ACCOMPANY THE ACCOUNT HOLDERS TO COLLECT BACK THE COOLIE PAID TO UNEMPLOYED PEOPLE AND SHARED BY MINISTERS, GOVT DEPT PANCHAYAT HEADS AND CONTRACTORS . I HAVE PROOF FOR COLLECTING BACK THE COOLIE PAID TO A VILLAGER WHO IS 80 YEARS OLD AND HAS CLEANED DRAINAGE AND SWEEPED ROADS (ACTUALLY NOT WORKED AT ALL SINCE SHE CANNOT STAND PROPERLY). THE GOVT HAS REMITTED COOLIE UNDER THE SCHEMES TO IN-OPERATIVE ACCOUNTS VIA NEFT .THIS IS HOW GOVT IS SPENDING MONEY AND MINISTERS ARE ACCUMULATING ASSETS.

Asokan

4 years ago

Pl. do publish details like which are companies loans were written off, and catagories.This will give how the banks are favouring ..

How Canara Bank victimised borrower of an education loan

Canara Bank sanctioned education loan of Rs15 lakh and after the borrower completed his course, told him that it can sanction only Rs10 lakh. The borrower was made to pay interest on Rs5 lakh as the Bank termed it as overdraft

A general perception is that a public sector unit (PSU) bank would work by the book and would be less aggressive in penalising its good, regular customer. However Canara Bank in Mumbai has done just the opposite by blatantly charging clean overdraft rate of interest on an education loan. All this due to the mistake of the sanctioning authority.

 

On 9 April 2009, Canara Bank sanctioned an Education loan of Rs15 lakh to Parag Punjwani for pursuing post-graduate (PG) programme in management at International School of Business (ISB), Hyderabad. Full disbursal of the loan was done and Parag completed the course in April 2010.

 

Suddenly in June 2010, the Bank informed him that a loan of Rs15 lakh was not possible as the ceiling for education loan to study in India is only Rs10 lakh. The Bank then applied an interest rate of 9.75% for Rs10 lakh as education loan and 14.75% (applicable to over-draft facility) for the remaining Rs5 lakh of the sanctioned loan amount.

 

Over the next three years endless letters, requests, pleas and follow-ups with the bank by Parag continued, without any success.

 

This looks like a clear case of error on part of the Bank official/s that sanctioned the education loan or Rs15 lakh without knowing if there could be any ceiling limit.

 

If Parag was told of this limit at the outset, he would have arranged for the shortfall from other sources. But as a result of this mistake, he was being penalised and forced to pay excess interest at the rate of 5% on outstanding amount of over Rs10 lakh. All this while, he was paying regularly his equated monthly instalments (EMIs) without any delays or disruption.
 


Finally, in April 2013, out of frustration on the issue being dragged on for so long, Parag filed a formal complaint before the Bank's Complaint redressal cell and later to the Banking Ombudsman.

 

Thereafter, the Bank agreed to refund all excess interest. Parag received this message over a telephone call from the Bank's Head Office (HO). Nothing in writing was issued either by the HO or by the Bank. The branch (from where Parag borrowed the money) said that it would refund Rs31,960 which was due as per their calculations. However the actual refunds were in excess of Rs80,000.

 

In the last week of July 2013, Parag was asked (by the Bank) to submit detailed calculations of the refund amount. He informed the bank that the excess amount deducted was Rs80,696. In August 2013, the amount of Rs80,696 was refunded into the loan account of Parag. It was a huge relief to the customer who felt harassed and victimised for no fault of his. Only his conviction saw him through this trauma and he was able to take on the might and muscle power of a large PSU bank.

 

There are a few issues, which can be highlighted and learnt from this incident:

1) Customers should read all communication from the bank carefully. Do not tear away/ destroy communications before reading through. It could be levy of extra charges or hike in interest rates.

2) Do not believe that the Bank deals with numbers and is fully automated, so will be always correct. Empower yourself with the knowledge of basic banking rules, interest calculation methods, look for extra debits of charges in the account statement and do not hesitate to ask for explanation from your Banker.

3) While taking up a controversial issue with your Banker, do not continue talking to them on phone or meeting them. Create a trail by way of letters and emails, which will come in handy at a later date. Even after a meeting, drop them an email mentioning the face-to-face discussions held.

4) The last resort help is by way of Consumer Redressal Forums and Banking Ombudsman. They have certain processes and time frames, which need to be followed. It would be helpful to know such details and abide by them, when writing to such authorities.

5) Give wide publicity to such incidents so that more people are aware of how Banks and Financial Institutions fleece innocent customers - sometimes to line their own pockets and sometimes to save their own skin.

User

COMMENTS

nagesh kini

4 years ago

Vital issues that need to be clarified -
1. Was the fact that the limit for studies in India is Rs.10l ( and not Rs.15l explicitly disclosed in the bank's website before the loan was sanctioned?
2. If the limit was in deed Rs.10l why was Rs.15l sanctioned at all for studies in India?
3. The bank is absolutely wrong in later on claiming as well as charging interest at a much higher rate.
4. The branch can't come round later to blame its controlling authority - its Circle Office - both of them are guilty for sheer negligence.
5. On what basis was the refund worked out? Does the bank expect every customer to sit down to calculate the interest workings?
6. How was a round sum of Rs.31,960 in the first place worked out when the actual amount charged was Rs.8o,696 which was conceded by the bank and ultimately refunded?
7. Customers GENERALLY tend to trust the bank and even sign DPN and other documents in blank and accept all debits at face value.
8. With this case all implicit trust in banks is lost and we all need to be double careful.
9. Had the borrower not been persistent the bank would have taken him for a jolly good ride. His efforts paid off in the long run.
10. Who in the bank is to be held responsible for his unwarranted mental harassment?
11. How effective is the Bank's in house redressal mechanism?
12. What steps has Canara Bank taken to prevent recurrance of such unjustified harassment?
13. This is a fit case to be dealt with at the Board level of Canara Bank.

JVIS Engineering

4 years ago

CANARA BANK ALSO HAVE THE REGULAR PRACTICE OF TAKING THE SIGNATURES ON BOTH THE BOTTOM OF EACH UNFILLED BANK FORMS AS WELL AS ON THE MARGINS OF THE SAID UNFILLED PAGE.

WHAT I LEARNT AFTER BURNING OUR FINGERS DUE TO THE FRAUD PLAYED UPON US BY THE CANARA BANK OFFICERS IS THAT THE MEANING OF SUCH SIGNATURES ALLOW THEM TO DO CORRECTIONS ON ANY OF THE LOAN PAPERS AT THEIR WILL AND WISH AS PER THEIR OWN WHIMSIES AND FANCIES TO FORGE PAPERS SO THAT THE POOR BORROWERS CAN BE TAKEN FOR A RIDE....

DEAR CUSTOMERS OF THE BANK BEWARE OF THESE GUYS AND DO NOT GET CHEATED BY THESE BANKERS....BETTER TRY TO DEPEND UPON YOUR FRIENDS AND RELATIVES FOR YOUR LOANS AND NOT ON THESE BANKERS......ELSE YOU SHALL BE THROWN OUT OF YOUR OWN HOUSE BY SUCH ACCOUNTING AND UNETHICAL FRAUDS...

JVIS Engineering

4 years ago

From the above complaint it is clear the Canara Bank and its officers played fraud on this poor chap.

My case is similar wherein the Canara Bank officers forged security papers to justify their fraud of not taking the risk cover under CGTSI scheme guaranteed by the Government of India. ANY HOW ALL THE FELLOW FRAUDSTERS SHALL KEEP JUSTIFYING THE SAME TILL THE TIME ONE MAN WITH CONSCIENCE COMES IN PICTURE OF THE BANKING SYSTEM AT LEAST IN THE SAID BRANCH OF THE BANK. ALL THE BEST TO THE POOR BORROWER AND WISH THAT HE PRAYS TO GOD TO SAVE HIM FROM THIS CROOKED BANK FELLOWS.....

vaidya

4 years ago

morever the condition for repayment also remains the same,and the repayment may start only after end of the period and after the borrower go the appointment.But int as per origianl terms of santion is become due and payable every quarter and his parents have to pay.

vaidya

4 years ago

Once amt of loan of 15 lacs sanctioend in writing,it can not change the terms and conditions &also change later without the consent of the borrower.If the borrower fully utilised the loan by way of fees, books, & maintenace with out any amt left, Bank has to abide by the terms and conditions of the original sanction only and can not charge any increase in the rate of int too.

vaidya

4 years ago

BANK HAS CHARGED CLEAN RATE OF INT OVER PART OF THE ALREADY SANCTGIONED LOAN OF 15 LACS,SINCE THISIS NOT BACKED BY ANY SECURITY.IF THE BORROWER OR HIS FATHER FURNISH ANY OTHER COLLETERAL BY WAY OF DEPOSIT OF TITLE DEEDS TO HIS PROPERTY, THE RATE OF INT IS BOUND TO COME DOWN CONSIDERABLY AS PER EDUCATION LOAN SCHEME.HE CAN BE ADVISED BY THE BANK ITSELF.

REPLY

Chaitali Dutta

In Reply to vaidya 4 years ago

BTW the loan was fully secured by way of extension of charge on the borrowers property for the full amount of 15lacs.

vaidya

4 years ago

AN EDUCATION IS SANCTIONED AND DISBURSED.AND THEREFTER BANK CAN NOT MODIFY THE SANCTION.ONCE A EDUCATION LOAN FOR 15 LACS.AND NOW BANK WANTED TO BRING PART OF THE LOAN UNDER YOGANA SCHEME WHICH IS ONLY BENEFICIAL TO THE BORROWER.AND SINCE HE HAS TO REPAY, HE CAN ALWAYS ADJUST FOR A SMALLER LIMIT AND FURTHER REDUCE HIS COMMITTMENT.HOWEVER, IT IS FOR THE BORROWER IS TO ACCEPT THE MODIFICATION AND CAN NOT BE FORCED ON HIM.

vaidya

4 years ago

tHEbANK COULD HAVE INFORMED EVEN BEFORE ACTUAL DISBURSEMENT OF ENTIRE 15 LACS, INSTEAD OF INFORMING LATER ABOUT,SINCE IT IS AT FAULT OF NOT INFORMING OR RESTIC ITSELF TO 10 LACS ONLY.LATGER MODIFICAION OF ANY LOAN ALREADY GRANTED IS NOT CORRECTG.

Deepak Mohan

4 years ago

I had used Canara bank for my own education loan - while painful in process they gave me a loan, so we approached them for my brother's education loan as well. The loan repayment allows 1 year from end of education or job whichever is earlier - since he had to move out of the country and return back, he did not apply for a job - we had informed the bank about this and indicated to them that we will commence repayment after 12 months or if he finds a job earlier - suddenly 1 day few officers start calling home from their recovery cell and asking for repayment else they will invoke SARFESI !!! Took us multiple visits to sort this out. Post that they refused to setup a standing instruction to take money out from the SB account - so every single month we had to go to the branch to make the payment !!! - Not going anywhere near Canara bank ( & BTW my mother is an ex employee from Canara bank !!! )

REPLY

Chaitali Dutta

In Reply to Deepak Mohan 4 years ago

I totally agree with you, Deepak. It is incidents like this which leave a bad impression and force us to move away from the institution in future. Customer awareness is on the rise and the services sector cannot get away with soddy handling of situations.

nagesh kini

In Reply to Deepak Mohan 4 years ago

Canara Bank seeking to invoke SARFESI more particularly, when the matter is very much alive, is extremely reprehensible and needs to be looked into and curbed by the controlling authorities at the highest levels.
This is plain and simple harassment of genuine borrowers,while on the other hand they go extremely easy on big chronic defaulters with all sorts of 'incentives' in the form of waivers and deferments in the name of 'corporate debt restructuring'.
Just because there are rising NPAs in the segment of the unsecured below Rs.4lakhs education loans which they are unable to manage, it doesn't permit them to go hammer and tongs against small borrowers who they know for certain will not go to court.Catch the big fish first and then chase the smaller ones!

vaidya

In Reply to Deepak Mohan 4 years ago

whether ur mother if x CB, allthemore u hve to adhere to the rules and pay promptly.and u should thank having giventhe laon and promptly pay as per terms sicne not many banks extents educaitonloan like CANARA BANK, FOR A LONG TIME.

nagesh kini

4 years ago

The RBI and IBA have clearly laid out Guidelines on Education Loans.That Canara Bank's internal Grievances Committee couldn't decide and force the student to approach the Banking Ombudsman is indeed a sad commentary on what is considered to be pioneer bank on Education Loans.
This student's efforts should be an eye opener to all students and bankers too!

vaidya

4 years ago

For a long term education Loan of more than 5 years and over, and for a good amt.Bank must have taken a LIC policy to that etent of loan amt with int.,so that incase of any exisgencies as party emigrates/expires, bank can als ways encash the LIC policy,provided the premium are paid well inadvance from loan amt granted.Party is safe and Bank is also safe.Term and condition can not changed either by the bank or the borrower once laid while granting.and there should mutual stamped agreement to be signed by both in this regad and also the guarantor/guardian

Iyer

4 years ago

The Bank seems to have forgotten the basic rule of being a customer friendly entity ,instead of traumatizing the borrower they should have had an approach which could have been solved in a better ,customer friendly manner as the basic mistake was with the Bank official who had been negligent and ignorant in knowing the loan limits for Vidyasagar loan .
By this harassment they have driven away good future customer as this borrower would have been a good ,loyal customer as he has next 30 to 40 years of income earning capacity,a very unfortunate incident where the bank must train its official in the right manner.

vaidya

4 years ago

Canara bank is one of the pioneers in Education Loan to all eligible students and many students got the benefits and paid after getting into employment.Hence this incident is rather rare and once the applicant appeal tothe authrorities,they will agree to consider, since the repayment are being made promptly.

REPLY

Chaitali Dutta

In Reply to vaidya 4 years ago

Dear Vaidya,
Education loans fall under priority sector banking and hence should be dealt with care. The Bank may have sanctioned millions of such loans, but the fact remains that irresponsible handling of one customer, has a long term and wide repercussions.

vaidya

4 years ago

it is not fair for the bank to revise its terms on theamt alrfeadylend as per sanction,theborrower has to pay as int rate in equatedinstalement and any other extra int if charged has to be taken back.Normally it does not happen.Perhaps it is the mistake of CM having sanctioned in excess of 10 lakhs and he has to get ratification from HOin this regard.

TIHARwale

4 years ago

Canara Bank officer would have confused Hyderabad of Pakistan and once he realised the mistake they have sought higher interest and when Ombudsman explained Hyderabad is India even though for some it may be a disputed territory for the politicians of Andhra Pradesh and Telangana

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