Moneylife Foundation holds workshop on banking services

Moneylife Foundation holds workshop on banking services

Mumbai 15 May 2010: Moneylife Foundation on Saturday held an interactive workshop on Banking Services, attended by a packed audience. Speaking on the occasion, Kaza Sudhakar, chief general manager, customer services department, Reserve Bank of India (RBI) said, “The Banking Ombudsman is only for catering to customers’ grievances, its entire intent is to see to it that banks try to resolve issues with customers in a speedy manner. But still, we find that many customers are fearful of approaching bank branches. We would advise the customers to get back to the concerned banks quickly.”

Mr Sudhakar talked at length about the rights and responsibilities of a consumer of banking services. He highlighted the numerous ways in which bank customers can be harassed and at the same time explained how their grievances can be redressed through the Banking Ombudsman (BO). He also outlined that customers need to be more careful and diligent while entering into any transactions. “I have come across several cases where customers put their signatures blindly on loan documents without thinking twice and then face severe difficulties. It is always advisable to look closely at the documents before jumping into any loan transaction. It is entirely a question of the customer’s ability to understand and gauge the risk.”

During his discussion, Mr Sudhakar highlighted common complaints dealt with by the BO. These pertain to ATM transactions, credit card issues, loss of housing loan documents, KYC procedures, loans against shares, etc. In one particular case of delayed pension payments, Mr Sudhakar explained how repeated complaints against State Bank of India (SBI) from one customer drove the RBI to issue a circular across the banking system, directing banks to make good the payments immediately, along with penal interest to the customers. This resulted in benefits to 65 lakh customers in the country.

Also present for the workshop was Mr OP Agarwal, Banking Ombudsman (BO), Maharashtra and Goa. Mr Agarwal advised customers on how to approach the BO with complaints and the procedure for the same. “Almost any area of banks’ service can be questioned in the BO. We are ready to help customers and get their issues resolved. You have to make sure that your complaint includes basic details like your name, the bank’s name, account details, etc. Keep the complaint brief and to the point. Also mention what exactly you expect from the bank in terms of compensation or services, etc.” He specified that the BO does not entertain personal hearings except in extreme cases or difficulties.

He also directed customers to be reasonable in their expectations from the BO and to give them a reasonable timeframe to get a response from the bank concerned. He asked customers not to confuse the role of the BO with that of the regulator, RBI.

The workshop was organised with a view to expose the users of banking services to the various facets of dealing with banks and to make them aware of their rights as customers. The event saw active participation from several members of the banking fraternity, with representation from some of the top public sector, private and foreign banks in India, including Bank of India, Citibank, Kotak Mahindra Bank, HSBC and HDFC Bank.

The audience had a healthy interaction with the two experts, with customers discussing and bringing to light various issues they had faced while dealing with banks.

Pictures of the event

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COMMENTS

Amandeep Singh

7 years ago

I think these workshops are a really practical and nice way to teach people about finance in India... where financial literacy rate is very low... I have written about these workshops on my blog...

http://www.equitipz.com/2010/05/how-to-be-safe-and-smart-with-your-money-a-free-workshop-by-moneylife-foundation.html

Navin

7 years ago

HI Team MoneyLife, I was there at the workshop.I wanted to write separately to you on it, btu then I see that you have already posted an article on how the workshop went. I am impressed!!
I did pose a question on why RBI should not levy punitive penalties to the banks to reduce the barrage of customer complaints which are reaching the ombudsman at RBI. For every complaint which comes to RBI, probably there are thousands more which do not.
When I say punitive damages, I dont mean that you enrich the complaining customer, even though that also might not be a bad objective!!
Regulators around the world levy hefty damages from those they regulate for not adhering to the regulations. In India, howsoever big the crime might be, the regulators hesitate to levy punitive damages/penalties to deter the offenders from repeating the mistakes. I remember vaguely that even for the demat scam, RBI had levied some fines to the colluding banks and it was funny how meagre those amounts were. Considering that almost all the banks earn the net profits in crores, why they should be mollycoddled by RBI when it comes to customer service beats me!!
I believe RBI has lost its focus - it claims that the FII money flowing in is not a cause of concern, it doesnt seem to believe that the property prices are manipulated, it doesnt know what can be done to curb the black money component of the economy, it probably allows SBI to decide what the banking industry and regulator should be doing, at other places its too intrusive and too transactional, it seems to be hell bent on protecting banks bad books (consider the number of changes it keeps making to give relief on provisioning norms, what more it seems to be over assertive now that the entire world thinks RBI did a great job by not opening the Indian economy as much as it could have - design or accident, its anyone's guess!!

I must congratulate the MoneyLife team on all the work they are doing to promote financial literacy. Their joining hands with Disha, an ICICI bank initiative, seems to be a step in the right direction. I still believe that the team at MoneyLife can connect to trhe masses far better and faster by doing a TV show. It can be a very interesting one definitely, as long as we know that all the concerned would be objective and would not end up using it as a tool to promote self!!

Fortnightly Market View: A Foggy picture

On Friday, 14th May, the Sensex fell 317 points, closing well below 17,000. All the talk of bullishness around us leaves us with a feeling that the market is gradually trending up. This is similar to the situation from September last year. The Sensex closed at 17,127 on 30th September, despite a huge post-Budget rally and thousands of crore of institutional investments having poured in for months together.

That is worrying. If the market cannot stage a strong rally from here, we will face another down-leg—towards 16,000. Long-term investors may assume that this does not change anything. They are confident that the India growth story is in place, corporate performance will be good and the market’s overvaluation is gradually getting corrected. This may be true in a normal situation. However, we are not even sure whether we are in a normal situation.

The market was up 1% over the week supported by a huge rally on the first day of the week on concerted efforts of the Eurozone to help the weak nations to come out of the debt crisis. This was followed by a correction on Tuesday, which can be termed as factoring out the measures taken. While trading was range-bound for the next two days, it sharply plunged on the last trading day of the week on concerns that the measures taken by the Euro nations to curb the fiscal deficit would impact the economic growth of these nations.

Among the top gainers on the BSE Sensex during the week, auto majors Tata Motors and Mahindra & Mahindra (M&M) jumped 6% each, HDFC Bank surged 6%, while DLF and Reliance Infrastructure (Reliance Infra) gained 5% each.

The top losers on the benchmarks were Cipla and Bharti Airtel, down 8% each, Reliance Communications (RCom) was down 6%, while metal majors Sterlite Industries (India) and Tata Steel shed 2% each.

In the sectoral space on the BSE, realty and auto indices were the top gainers, advancing 4% each. On the other hand, capital goods and metals ended flat with a negative bias.

India’s sugar output is likely to rise to 24-25 million tonnes in 2010-11. Domestic consumption was about 22-23 million tonnes while production was only 18.5 million tonnes in 2009-10. 

The food price index rose 16.44% in the year to 1st May, above the prior week's annual rise of 16.04% on the rise of vegetable prices as a heat wave in the country damaged perishable foods, government data released on Thursday showed. The fuel price index stood at 12.33%, down from the previous week's annual rise of 12.69%, while the primary articles’ index was up 16.76%, compared with the previous week's reading of 13.93%.

The annual wholesale price index was 9.59% in April from a year earlier, which is lower than 9.9% in March’s data and 10% in February. 

The chief economic adviser suggested the Reserve Bank of India’s (RBI) intervention to counter the rupee’s appreciation against the dollar. The rupee’s rise against the greenback has put huge pressure on the exporters. In 2009-10 the rupee has strengthened 12.6% against the dollar and 8.3% against the euro year-on-year.

India has secured a contract of buying 4.7 million tonnes of the soil nutrient at $370 per tonne for FY 2011 with an option to buy more, nearly 20% cheaper than the previous year’s price. The country also imports most of its di-ammonium phosphate (DAP) requirement and has tied up for 7 million tonnes DAP at $500 a tonne.

Industrial output grew slower than expected 13.5% in March from the year-ago period. The slow growth is because of the partial withdrawn of stimulus measures and an increase in interest rates. The Planning Commission however believes that the slowdown in the March industrial output will not affect the GDP of FY 2009-10.  RBI said that the capital account will be opened gradually and there is no plan of imposing Tobin tax to curb currency speculation. Tobin tax is a transaction tax on currency conversions intended to curb volatility and speculation. The capital account convertibility is integrally attached with the broader goal of economic growth. However, RBI also expressed its preference for long-term equity flows over the short-term debt flows.


In the global arena, US market regulators and six major exchanges accepted the need for new safeguards to curb trading in plunging markets, an effort to address last Thursday’s mysterious market freefall.

The European Union (EU) agreed to a loan package, along with International Monetary Fund (IMF) support, to stop a credit crisis in Europe. The European rescue plan, valued at more than $900 billion (€720 billion), has three main components. The biggest provision at nearly $570 billion (€440 billion) takes the form of government-backed loans to regain confidence in the weak credit markets. A second measure is the expansion of a $77 billion (€60 billion) stabilisation fund, which will be available to Eurozone states facing exceptional circumstances. Finally, the IMF said that it would contribute $284 billion (€220 billion). The European Central Bank (ECB) will buy eurozone government bonds and private debt. The IMF said that Greece's public debt is sustainable over the medium-term; however, low growth could be a setback for the country.

 

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Weekly Market View: A Rough patch ahead

A fresh downturn may have started

The market was down on concerns over the tough austerity measures taken by eurozone nations, which may slow down the global economy. The Sensex ended at 16,994, lower by 271 points (1.5%) while the Nifty shut at 5,093, lower by 85 points (1.6%). The bourses started the day with an initial gain. However, they pared their gains around noon with weak European equities dragging the indices lower. Bank, realty and metal stocks were down.

Asian stocks recovered from an initial fall triggered by an overnight decline on Wall Street. Key benchmark indices in Indonesia, South Korea and Taiwan were up by 0.02% to 0.24%. On the other hand, benchmark indices in Singapore, China, Hong Kong and Japan fell by 0.39% to 1.49%.

US stocks were down on Thursday as downbeat comments on the economy from Cisco Systems and retail chain Kohl’s Corp shadowed concerns over the economic recovery. The Dow dropped 114 points (1.05%) to end at 10,783.

The S&P 500 fell 14.23 points (1.2%) to 1,157. The Nasdaq lost 30.66 points (1.26%) to close at 2,394. US central bankers said that the promise to hold the interest rate lower for an extended period depends on the economic conditions. 

Back home, India's foreign exchange reserves fell to $276.23 billion as of 7th May, from $279.63 billion a week earlier, the Reserve Bank of India (RBI) said in its weekly statistical supplement.

India has secured a contract for buying 4.7 million tonnes of soil nutrient at $370 per tonne for FY2011 with an option to buy more, nearly 20% cheaper than the previous year’s price. India also imports most of its di-ammonium phosphate (DAP) requirement and has tied up for 7 million tonnes DAP at $500 a tonne.

The chief economic adviser suggested that the RBI may intervene to counter the rupee’s appreciation against the dollar. The rupee’s rise against the greenback has put huge pressure on exporters. In 2009-10, the rupee had strengthened 12.6% against the dollar and 8.3% against the euro year-on-year.

Foreign Institutional Investors (FIIs) were net sellers, offloading stocks worth Rs15 crore. On the other hand, Domestic Institutional Investors (DIIs) were net buyers, purchasing stocks worth Rs222 crore. The rupee was down on the weak equity market and the greenback’s strength against the euro.

HDFC (down 1%) has extended its concessional home loan scheme till 30 June 2010. As per the scheme, the housing finance major would offer a fixed interest rate of 8.25% up to March 2011; 9% for the next one year and a floating rate thereafter. Reliance Industries (RIL) (down 2.6%) will join the ONGC-led consortium that may get rights to oil fields located in the Orinoco belt of Venezuela. RIL did not take part in an earlier consortium led by Indian State-owned oil companies, which won the $20-billion Carabobo 1 oil block in Venezuela as it was busy trying to tie up the LyondellBasell acquisition. 

Infosys (down 1.6%), Mahindra Satyam and unlisted company Cognizant have been shortlisted by UK's National Grid, which manages the country's natural gas and electricity networks, for an outsourcing contract. Seven offices of Parsvnath Developers (down 2.6%) in Delhi and the National Capital Region (NCR) have been searched by the Income-Tax Department. Oil PSU stocks were in demand as crude prices are on the lower side. Light, sweet crude oil dropped $1.25 or 1.65%, to $74.40 a barrel on Thursday. Zensar Technologies (down 0.5%) has received a contract worth over Rs100 crore from a leading South African insurance company for a period of five years.

 


 

 

 

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