While people continue to criticise the services offered by public sector banks, it is the foreign and private players who seem to be attracting the most complaints
According to the 2008-2009 report published under the RBI’s Banking Ombudsman Scheme, the number of complaints received per 1,000 accounts is the highest among foreign banks and banks in the private sector, with banks in the public sector having comparatively fewer complaints.
The study, included in the annex of the RBI annual report, reveals the total number of complaints received under the Banking Ombudsman (BO) Scheme, started in 2006, along with break-ups showing the number of complaints against individual banks, number of complaints per 1,000 accounts (non-credit card related) and number of credit/debit card related complaints per 1,000 credit/debit card accounts.
In our analysis of the report, which is available on the RBI website, we have focused mainly on the number of complaints per 1,000 account holders, as opposed to the total number of complaints. This is because banks with larger numbers of customers will face a larger number of complaints, and looking at the number of complaints per 1,000 accounts is the only way to put all banks on an equal footing. We have also disregarded outliers who have only a few accounts.
The results show that foreign banks have the highest complaints followed by private sector banks; public sector banks have the least number of complaints—which is surprising and contrary to general perception.
This lends credence to the charge of a banker, who does not want to be named, who said that foreign and private sector banks have savvier customers who are more aware of their rights and more likely to lodge formal complaints.
Hence, we decided to focus more on comparisons within this group.The report shows that among foreign banks, Barclays Bank and ABN AMRO were the most complained about with 1.31 and 1.02 complaints per 1,000 accounts.
The other big foreign banks also showed large, though relatively lesser complaints, with HSBC having 0.35, Citibank having 0.34 and Standard Chartered Bank showing 0.34 complaints per 1,000 accounts.
In terms of credit and debit card related complaints, Barclays again topped the charts with 1.59 complaints per 1,000 card holders. Coming in at a distant second with 0.65 complaints per 1,000 was again ABN AMRO. HSBC and Standard Chartered followed with 0.57 and 0.44 respectively. Citibank had 0.23 complaints per 1,000 card holders.
HSBC had the highest number of complaints overall with 2,838 followed by Citibank with 2,563. As noted earlier, this is primarily because they are much larger than their competitors, and the total figure should not be viewed as an indicator of performance.
Private sector banks also had high levels of complaints with Kotak Mahindra Bank having 0.71 complaints per 1,000 account holders. Among the larger banks, another surprise was that HDFC Bank had 0.43 complaints per 1,000 accounts, which was significantly higher than ICICI Bank which had 0.28 complaints. This is again contrary to perception. A pleasant exception to the trend was Axis Bank which had only 0.17 complaints per 1,000 account holders. ICICI Bank had the highest number of total complaints with 11,453.
When looking at credit and debit card related complaints, the trend was more uniform with ICICI Bank having 0.17 complaints per 1,000 card accounts and HDFC Bank and Kotak Mahindra receiving 0.13 and 0.12 complaints per 1,000 card accounts respectively. Axis Bank again had the fewest complaints with only 0.04 complaints received per 1,000 credit or debit card holders.
Public sector banks showed the most surprising results, considering the common perception of nationalised banks offering poor facilities and service.
State Bank of India (SBI), India’s largest bank, had received 0.13 complaints per 1,000 accounts and 0.09 credit or debit card related complaints for 1,000 credit/debit card accounts.
Bank of Baroda had 0.06, Bank of India had 0.04, Canara Bank had 0.05, Central Bank of India had 0.06, Punjab National Bank had 0.07 and Union Bank of India had 0.06 complaints per 1,000 accounts.
The figures for credit and debit card related complaints for the above entities were 0.05, 0.03, 0.03, 0.06, 0.03 and 0.04 complaints per 1,000 card accounts respectively.
The numbers show that whether it is because of poor service or more aware customers, foreign and private sector banks have some issues they need to address.