Do They Prac­tise As They Say?

Consumer Voice - - Bfsi -

This has sig­nif­i­cantly in­creased the cost of funds for banks. At the same time, tech­nol­ogy and com­pe­ti­tion have made hitherto pre­mium prod­ucts a stan­dard fea­ture now – for ex­am­ple, fixed de­posits linked to sav­ings prod­ucts. High earn­ings from dis­tribut­ing in­sur­ance prod­ucts have al­ready pe­tered out and threaten to de­crease if banks are forced to be­come bro­kers.

So, yes, for banks to main­tain higher lev­els of ser­vice, it is ex­pected that they will bring ser­vice charges in line with the in­crease in costs. Banks have been given the free­dom to fix ser­vice charges for bank­ing trans­ac­tions, which in­cludes in­ci­den­tal charges for is­sue of bank drafts, with the ap­proval of their boards. While fix­ing ser­vice charges, they should en­sure that the charges are rea­son­able and not out of line with the av­er­age cost of pro­vid­ing these ser­vices. In or­der to en­sure trans­parency, banks are re­quired to dis­play and up­date on their web­sites the de­tails of var­i­ous ser­vice charges in a pre­scribed for­mat. Si­mul­ta­ne­ously, it is im­por­tant that they re­view the fair­ness and ef­fi­ciency of their cus­tomer ser­vice and make im­prove­ments as needed.

Com­ing to the crux of the prob­lem, are banks’ ser­vice charges uni­form? Is the lan­guage straight and clear in the de­scrip­tion of the charges levied? Why do dif­fer­ent banks use dif­fer­ent ter­mi­nol­ogy for the same ser­vice – for ex­am­ple, con­ve­nience fee, can­cel­la­tion charges, or just ser­vice charges?

There is a gen­eral feel­ing among bank cus­tomers that ser­vice charges rules are more for the­o­ret­i­cal pur­poses and hardly abided by. While con­duct­ing this study, we came across many in­con­sis­ten­cies be­tween the­ory and prac­tice in cer­tain banks. This is de­spite bank branches be­ing linked through cen­tral­ized

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