Moneylife Campaign - RBI asks banks to provide details of transactions to customers
Taking cognizance of several complaints from customers, letters and memorandums, the Reserve Bank of India (RBI) has once again asked banks to record details of transactions in the passbook or statement of accounts of customers. The RBI had issued similar instructions some 13 years ago, which banks have not been following.
 
In a notification issued on 22 June 2017, the central bank says, "It has come to our notice that many banks still do not provide adequate details of the transactions in the passbooks and/or statements of account to enable the account holders to cross-check them. In the interest of better customer service, it has been decided that banks shall at a minimum provide the relevant details in respect of entries in the accounts."
 
RBI expects banks to share transaction details like the name of the payee, mode of transaction and name of transferee bank. For bank charges, the lenders have to provide nature of charges, like fee, commission, fine or penalty and reasons for the charges. (See details of entries that banks have been asked to record and share with customers below this article) 
 
"Banks shall also incorporate information about ‘deposit insurance cover’ along with the limit of coverage, subject to change from time to time, upfront in the passbooks," RBI has said.
 
As part of its advocacy efforts, Moneylife Foundation has led the effort to fight for customer rights. Despite our efforts, we have seen very little evidence on the ground of concrete action by the regulator. 
 
Moneylife Foundation has been at the forefront of speaking up for bank customers. An online petition launched by us has garnered more than two lakh signatures. (Sign the Petition). The group, including well known NGOs, trade unions, finance editors and experts, had on 12 May 2017 presented a 1,100 page printout of over 100,000 signatures to an online petition at Change.org to M Veerappa Moily, Chairman of Parliamentary Standing Committee on Finance.
 
One of the key points of the petition is about capturing and sharing with customers the details of bank transactions, like name, branch and account number of sender and receiver. "...even a single digit mistake in the 10-digit account number causes a person to lose money with no practical remedy. This has a very simple solution, which is to capture the name, branch and account number of the sender and receiver. RBI must modify its systems to capture and share details of both sender and receiver and ensure effective grievance redress," the letter given to Mr Moily says. 
 
However, what is shocking is that though on 10 April 2004 banks were advised to avoid making inscrutable entries in passbooks or statement of accounts, 13 years later banks were still not following the advice. 
 
In 2004, the RBI-appointed Committee on Procedures and Performance Audit on Public Services, in its Report No. 3, had stated, "...banks invariably show the entries in depositors’ passbooks/statement of accounts as ‘By Clearing’ or ‘By Cheque’. Further, in the case of Electronic Clearing System (ECS) and RBI Electronic Funds Transfer (RBIEFTR) banks invariably do not provide any details, even though brief particulars of the remittance are provided to the receiving bank. In some cases computerised entries use sophisticated codes which just cannot be deciphered." 
 
"With a view to avoiding inconvenience to depositors, banks are advised to avoid such inscrutable entries in passbooks or statements of account and ensure that brief, intelligible particulars are invariably entered in passbooks or statements of account. Banks may also ensure that they adhere to the monthly periodicity prescribed by us while sending statement of accounts," the Committee had said. 
 
It would be interesting to see if banks follow RBI’s advice this time or continue to ignore it, as they have been doing these past 13 years.  
 
Here are the details of transactions banks will record and share with customers:
 

 

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    COMMENTS

    manisha Parimoou

    3 years ago

    Its a great move....i believe all the banks should follow these procedures and guidelines.

    Ramesh I

    4 years ago

    SBI is notorious for having 'network issues' whenever I visit the Branch for getting my passbook updated. A printout is permanently fixed on the counters by the Branch. Now that SBI has raised its MAB to Rs. 5000 in metros, why can't it provide a monthly e-statement to every customer ? It already has the email IDs and mobile numbers of every customer of Savings Bank A/c. Moreover, SBI Branches rarely respond to customers' query, as their Toll Free CC is mostly unhelpful, directing callers to the Branches whose contact numbers they refuse to share too. PSU Banks lag behind private Banks by miles when it comes to customer-orientation. Wish RBI would look into such issues as well.

    Anand Vaidya

    4 years ago

    Nothing has improved. See this entry from IOB passbook and figure out what it means:

    47068208-
    NFS330842O081216X1747-
    xxxx0000xxxxx (SB A.C No)

    Ramesh Poapt

    4 years ago

    Great ML!

    Suketu Shah

    4 years ago

    RBI's intent is not always sincere as per the track record.There is a photo of previous RBI governor sharing the dias with Videocon Dhoot one of the biggest defaulters of bad loans.Seems they were nicely chatting,notjhing else.

    Gitesh Shah

    4 years ago

    This is something basic which banks should provide. Wonder why competition among banks not making one of them come forward with this? I would add, bank communication should be provided in the language of customer's choice. At least English, Hindi and the regional language where bank is located should be given as a choice.

    Deepak Narain

    4 years ago

    It is a good development. I hope the Banks will comply and the RBI will monitor compliance.

    GLN Prasad

    4 years ago

    Even without this directives, any citizen can seek such information both as consumer and as citizen under RTI Act. There is nothing remarkable in the circular. It is just to reiterate the earlier directive.

    K V RAO

    4 years ago

    Government banks have notified working hours but never follow them. Lunch time is always exceeded. exceeded. Will RBI take note of this and does surprise checks?

    K V RAO

    4 years ago

    SBH NOW SBI in BANGALORE shows working times but has an extended lunch times. This is the case with all the banks. Who will stop this?

    PRAKASH D N

    4 years ago

    It only shows the lackadaisical attitude of RBI towards Customer Care. If RBI has will, Banks can be made to act within 15 days. Whether there is any will?

    anil kumar srivastava

    4 years ago

    Banks even having state patronage are akin to more commercialisation as it was pre- nationalisation in year 1969, the persisting attitude of Banks has forced them Prime minister Amy. INDIRA GANDHI to nationalise Bank for Social upliftment in the spirit of the Constitution of India; but by demonetization, PM has vacuumed the house hold currency chest of common men and overstuffed currency chest of banks litterly choking cash flow and prompting Banks to get profit targets by over charging services than earning out of overstuffed currency chests by soft loaning for overall growth of economy of the Nation.No this move will ultimately ruin the Indian economy in coming years as as purchasing power of common will reduce resulting slump in Market leading to closure of industries and reduction in trade with negative impact on employment with prompting youth resorting to unrest tearing socio- economic structure of India turning great cause of debacle of BJP citadel of power like Congress has faced in long term.It is time to awake and streamline Banks to save Indian economy.

    Ismail Bandookwala

    4 years ago

    Let's hope the banks follow the RBI instructions now. The RBI should also declare the penalties for non compliance.

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