Praise for grievance redressal system in India

The GPFI study makes a specific mention about the grievance redressal mechanisms in the Indian financial services segment. It says: “India has witnessed a substantial rise in the volume and value of digital financial transactions. Alongside the growth in digital transactions, the number of complaints has also grown and therefore, necessitate better redressal mechanisms.

The complaints received in the Offices of the Banking Ombudsman corroborate this observation. The percentage share of digital complaints to total complaints in the OBOs increased from 28% in 2017-18 to 33 percent in 2018-19. Therefore, the Reserve Bank of India has implemented several redress mechanisms. The first, the Banking Ombudsman Scheme has incorporated Mobile/ Electronic Banking as valid ground of complaint as of 1 July 2017 and as many as 64,607 complaints pertaining to digital services were received 2018-19. Second, it has mandated a dedicated Ombudsman Scheme for Digital Transactions which was launched on 31 January 2019. Third, all non-bank issuers of Prepaid Payment Instruments (PPIs) with more than 10 million outstanding PPIs as on 31 March 2019 have been mandated to appoint an Internal Ombudsman (IO). (Banks with more than 10 banking outlets in India have to appoint IO.)

The IO is an independent authority at the apex of the entity’s grievance redressal system. The opinion of the IO is binding on the NSPs. Lastly, the country has launched a Complaints Management System (CMS), a state-of-theart application to digitize its grievance redressal process and aid seamless flow of information amongst the participants like banks, NBFCs, System Participants, etc. Out of the total number of complaints lodged on the CMS portal, where sex-disaggregated data is available, 17% were from women. The complaints were lodged from 24 June 2019, when the CMS was launched, to 17 June 2020.