Is there any "body" existing for banking dispute?

By Saurav Yadav

Published on: February 8, 2024 at 12:16 IST

Have you watched a show named “tarak mehta ka ulta chasma”, the intro of their theme song starts with line {“Problem hai, (then the curtain is removed) andar solution hai”}. That’s what Baking Ombudsman is for you, if you have any problem related to baking service or bank or any problems between you and your bank. The Banking Ombudsman is like a helper for solving problems between you and your bank in India.

Banking Ombudsman listen to both sides and try to find a fair solution. It's free, you don't need a lawyer, and they aim to fix things quickly. If you don't agree with their decision, you can ask them to look at it again. Instead of going to Court, which can take a long time, the Banking Ombudsman is a quicker way to get help with your banking problems.

In this article, we are going to dive into the thrilling Domain of banking law, that is Banking Ombudsman.

What is Banking Ombudsman?

The Banking Ombudsman acts as a helper appointed by RBI to take care of any problems or complaints people have with their banks in India. This special person, called the Ombudsman, is there to listen to customers and solve any issues they might face with their banking services. This includes all types of banks, like public, private, rural, and co-operative banks.

Originally started in 1995, it got some big updates in 2006 to include problems with ATM cards, debit cards, credit cards, unfair practices by banks, and issues with promises made by bank agents. In 2009, it was changed again to cover problems that come up with online banking. The Banking Ombudsman is like a friendly problem-solver for all things related to banking complaints.

Banking Ombudsman is a government-appointed official who investigates and resolves complaints against banks and other financial institutions. The Banking Ombudsman is a free service, and they can help with a wide range of issues, such as unfair fees, unauthorized charges, and errors in your account.

Key features of Banking Ombudsman:

The Banking Ombudsman is typically appointed by the regulatory authority or central bank of a country some common features include:

• Appointment and Role: The RBI appoints a senior official known as the Banking Ombudsman to oversee and manage the resolution of banking-related complaints. This official plays a crucial role in addressing the concerns of customers.
• Scope of Coverage: The Banking Ombudsman covers a wide range of banks, including public sector banks, private banks, rural banks, and co-operative banks. This ensures that customers of various types of banks have a recourse for their complaints.
• Process and Accessibility: Customers who have complaints against their banks can approach the Banking Ombudsman. The process is designed to be accessible, and customers do not need legal representation. The Ombudsman's office provides a platform for individuals to present their grievances.
• Resolution Timeframe: The Banking Ombudsman aims for a prompt resolution of complaints. There are specific timeframes within which complaints should be resolved, ensuring that customers do not face prolonged delays in getting their issues addressed.

What are the functions of Banking Ombudsman?

The Banking Ombudsman is a quasi-judicial authority that resolves disputes between banks and their customers. some functions are listed as following:

• Dispute Resolution: The Ombudsman addresses and resolves complaints and disputes between banks and their customers, facilitating a fair and quick resolution.
• Awarding Compensation: If the Ombudsman finds merit in a complaint, they may award compensation to the aggrieved party for financial loss or mental agony.
• Educating Consumers: The Ombudsman educates consumers about their rights and responsibilities, creating awareness about banking practices and regulations.
• Promoting Fair Practices: The Ombudsman promotes fair banking practices and ensures that banks adhere to the prescribed codes and standards.
• Reporting to Regulatory Bodies: The Ombudsman submits periodic reports to the regulatory bodies, providing insights into the nature and resolution of banking complaints.

Is Banking Ombudsman really effective?

This body, called the Banking Ombudsman, handles almost all kinds of complaints related to banking services as of 2015. So, if you have a problem with your bank, you can tell them.

In the year 2009-2010, the team got around 79,266 complaints. They managed to solve about 94% of them, which is pretty good. Only 5-6% took more time, like over three months.

India has 15 Banking Ombudsman offices. You complain to the one that matches your bank's location. For example, if your bank is in Bangalore, you complain to the Bangalore Banking Ombudsman.

If you or your bank doesn't like the decision the Banking Ombudsman makes, you can take it a step further. You can go to the Appellate Authority within 30 days. This is like a higher-level person at RBI, called the Deputy Governor.

In simple words, the Banking Ombudsman is the place to go if you have a problem with your bank. They usually solve a lot of problems, but if you're still not happy, there's another person at RBI you can talk to within a month.

Types of complaints accepted by the Banking Ombudsman

The Banking Ombudsman accepts various types of complaints related to deficiencies in banking services. Here are the common types of complaints that can be submitted to the Banking Ombudsman:

• Late or Missing Payments: If your bank is not paying your cheques or drafts on time, you can complain.
• Problems with Small Notes and Coins: If the bank refuses to take your small notes or coins, you can tell the Banking Ombudsman.
• ATM, Debit, or Credit Card Issues: If you face issues with your ATM, debit card, or credit card, the Banking Ombudsman can help.
• Unauthorized Transactions: If you notice transactions you didn't do, especially through electronic means, you can complain.
• Tricky Selling of Financial Products: If the bank tricks you into buying things like insurance or mutual funds, you can file a complaint.
• Unexpected Service Charges: If the bank takes money from your account without telling you first, you have a right to complain.
• Unfair Practices by Banks: If the bank is not fair with you or breaks the rules, you can tell the Banking Ombudsman.
• Broken Promises by Bank Agents: If the promises made by the bank's agents (the people who help you open accounts) are not kept, you can complain.
• Any Other Bank Service Issues: If something is wrong with the bank service you're getting and it's affecting you, the Banking Ombudsman is there to help.

How to lodge the complaint?

If you ever feel you have a clear problem with your bank, don't hesitate to use this service. It's like a helpful friend that looks into your situation. But remember, they take things seriously. So, only use it if you're sure about your situation. Also, this service is not very known to everyone, so it's good to spread the word that it exists and can solve many small issues.

Complaining to the Banking Ombudsman is like telling a friend about your bank problem. You can do it online or offline, whichever works for you. Just make sure your problem is real, and they'll try to help you out.

• Online Complaint: Imagine you're using the internet to tell the Banking Ombudsman about your problem. You go to their website and fill out a form. It's like an online paper where you write about what's wrong. After that, you might need to upload some proof, like letters from the bank, in a special format (PDF or TXT).
• Offline Complaint: Now, think about doing this without the internet. You download a form from their website, just like picking up a paper. On this paper, you write down your contact details, your name, where you live, and details about the bank causing the problem. You also add any proof you have and say what you want in return for the trouble. Once you've filled out this paper, you send it to one of the 15 addresses of the Banking Ombudsman that's in charge of your area.

Conclusion

The Banking Ombudsman is like a friendly helper for people who have problems with their banks. You can tell them about issues online or by filling out a form. They try to solve problems and make sure you're treated fairly.

Whether it's late payments, problems with cards, or unfair practices, the Ombudsman is there to listen and resolve problems. You can complain online or offline, depending on what suits you. It's a valuable resource that many people may not be aware of, and it's worth spreading the word about its existence. If you have a genuine concern, don't hesitate to reach out to the Banking Ombudsman for assistance in finding a fair solution to your banking problems.