Costly indifference of Bank

This is further to my post on the indifference of some banks to the communication from the customers/public on  19-Dec-2012 at : http://bankerkapali.blogspot.in/2012/12/differently-abled-banking-system.html in this blog.

Earlier this year I observed at a branch of  a Nationalized bank that the customers operating lockers are forced to pass through the bank's cash counters. This exposes the lakhs of cash and also the cashiers at the Cash department to a great risk of being attacked from behind, when they are focused on serving the customers. Realizing the grave security risk I approached the branch manager and apprised him about my concerns and also sent an email to him and the Top management in May 2012.

It was distressing that the bank neither acknowledged the communication nor took steps to mitigate the risk. I reminded the bank again in July 2012, for which the Executive Director's office responded that the matter is being referred to their concerned Regional Manager & General Manager for appropriate action. But, to my surprise and anguish, till last week the bank has not taken any steps to rectify this thereby exposing the Bank and its staff to grave risk.

Under the light of the above warning and drawing attention, it is not surprising that yesterday at a Bank branch,  a stranger just walked into the banking hall, strolled into the staff area and took away Rs 11 lakhs from the Cashier's table in 30 seconds in broad daylight. It is again ironical that the loot was noticed only hours later before closing in the evening, as reported in Times Of India !

After reading the news report of the above incident, when I drew their attention today that the issue raised in my email dated 7-May-2012 is open still, my email was forwarded to the Customer Service Department , who in turn has forwarded the email to the concerned branch again!

It is a matter of concern that there seems to be little application of mind to a grave issue suggesting potential security risk to the Bank, their staff and property. One has to be thankful to God for small mercies, now that my today's email has been responded. But there are some questions still remaining open:

1. What about the status of the emails which were referred to the concerned Regional Manager & General Manager by the ED's office, in July 2012?

2. When and how was it closed?

3. Why is that this security risk identified by a common man has not been identified so far by the Security Dept or the periodical security audits?

4. Why is that the a grave security concern brought to the notice by a public has not been addressed by the Bank for months, inspite of follow-ups by him?

I can very well obtain these information by posting a query under RTI but my idea of following up on this issue is not to harass the bank or bring its name to disrepute or play the good cop here. I am truly concerned about the welfare of the bank and its staff and hence the agony arising out of indifference.

On a similar note, when I raised another concern , the management did not even care to acknowledge my email. I am now stumped as to where else can I knock the door when the majority of the responsible senior management has not cared to respond to customer communication.

If a customer communication cannot be even acknowledged , I wonder what are the other activities of the 'Customer Service Department"?

I am not elated. I don't want to say " I told you so" - but I am very saddened that a Bank of repute should be going down the barrel in service while there is all the technological and other support available to serve people better.

Dear Bank, there are Good people all around in this country and they are still searching for the right people with whom they could grow ! Please wake up.

Differently Abled Banking System?

This is to highlight an instance of apathy and calculated indifference of a Bank to the voice of an employee turned customer.

A certain additional facility was being extended to the retired employees in a bank and the communication to the eligible, I felt, was not properly done. Being a prime facility, I was of the opinion the bank was slack in even communicating the same.  I was also concerned that the facilities being extended after much deliberations should not be deprived to a section of the eligible due to communication issues, in this era of technological and communication advancements.

Not knowing whom to address, I wrote to the Chairman of the Bank copying one of the Executive Directors to the email ids available in the bank's website, politely drawing their attention to the shortcoming. My email of 12th Sep was not even acknowledged despite a reminder on Sep 18th. On the 22nd Sep, I connected to another ED of the Bank drawing his attention to the lack of response and requested for action, as the scheme was to close shortly. As this also fell on deaf ears I was at a loss as to where else I could go above the Chairman & senior executives for a genuine grievance against the bank's practice. Browsing through the website, I decided to knock at the doors of the Ombudsman and on the 23rd Oct I drew their attention to the indifference of the bank to the issue and the discourtesy of not even acknowledging a mail even by their highest officials.  

The Ombudsman office acknowledged fairly quickly but closed the issue yesterday (18th Dec) stating that the '. . . issue raised in my complaint does not fall under the purview of the Banking Ombudsman scheme. . . '.

What I fail to understand are:

•  If a bank is not responding to a communication from its customer, what is the recourse available?
•  In this computerized era, what is preventing the bank from acknowledging customer mails?
•  Why is that the office of Chairman was not even having an automatic reply facility which even an ordinary start-up company could boast of?  Should this be treated as ignorance of technology or indifference to customers?
•  Ombudsman might have been set up by the Apex body to look into some specific, identified categories of complaints and as such their claim of 'not falling under such categories' is understandable. But then, is this not an aspect which the Central Bank of the Nation should first insist upon? How is that, this is not in their ambit? People concerned must realize that in addition to grievances resulting in financial losses customers are also entitled to basic courtesies and have a right to be peeved if it is denied.
• As a matter of courtesy,  they were kind enough to forward a copy of the complaint to a General Manager of the Bank for' information and necessary action'. I am sure being forwarded from this office, I will be getting some response now. Or am I hoping too much that the Ombudsman's communication will be responded to!
•  But, then is this not the suggested solution for the issue reported - Ombudsman directing the bank to respond? What is preventing them from directing the bank in doing this as a solution instead of ducking the issue citing technical reasons about which a customer is neither aware of nor interested in?
•  To the most misused cliche , 'Last but not the least', if I still do not get any response, pray tell me which door is left for me to knock at?  When a bank is deaf to its customer's woes, its appointed authority is blinded by rules, should the customers remain mute to such insults of poor business ethics?

Is our banking Industry so severely crippled with deaf banks and blind authority producing dumb customers?

Cheque Truncation System

Recently banks are informing their customers that some of the cheque book they are using now will soon need to be replaced with a new cheque book for future use. This is due to Reserve Bank of India's initiative to speed up the clearing process thereby enabling the customers to get early credit of their cheques.

What is this Cheque Truncation System?

How will this benefit the customers?

What happened to the Post Dated Cheques already issued?

What will happen if the old cheque book is used after the stipulated date?

Is there any additional charges to be paid by the customers for obtaining the new cheque book?

RBI has clarified in their website such common doubts from the customers. and an extract on CTS is given below for reference:

1. What is Cheque Truncation?

Truncation is the process of stopping the flow of the physical cheque issued by a drawer at some point with the presenting bank en-route to the drawee bank branch. In its place an electronic image of the cheque is transmitted to the drawee branch by the clearing house, along with relevant information like data on the MICR band, date of presentation, presenting bank, etc. Cheque truncation thus obviates the need to move the physical instruments across branches, other than in exceptional circumstances for clearing purposes. This effectively eliminates the associated cost of movement of the physical cheques, reduces the time required for their collection and brings elegance to the entire activity of cheque processing.

2. Why Cheque Truncation in India?

As explained above, Cheque Truncation speeds up the process of collection of cheques resulting in better service to customers, reduces the scope for clearing-related frauds or loss of instruments in transit, lowers the cost of collection of cheques, and removes reconciliation-related and logistics-related problems, thus benefiting the system as a whole. With the other major products being offered in the form of RTGS and NEFT, the Reserve Bank has created the capability to enable inter-bank and customer payments online and in near-real time. However, as cheques are still the prominent mode of payments in the country and Reserve Bank of India has decided to focus on improving the efficiency of the cheque clearing cycle, offering Cheque Truncation System (CTS) as an alternative. As highlighted earlier, CTS is a more secure system vis-a-vis the exchange of physical documents.

In addition to operational efficiency, CTS offers several benefits to banks and customers, including human resource rationalisation, cost effectiveness, business process re-engineering, better service, adoption of latest technology, etc. CTS, thus, has emerged as an important efficiency enhancement initiative undertaken by Reserve Bank in the Payments Systems area.

3. Will there be any change in the process for the customers?

No. There is no change in the clearing process for customers. Customers continue to use cheques as at present, except to ensure the use of image-friendly-coloured-inks while writing the cheques. Of course, such of those customers, who are used to receiving the paid instruments (like government departments) would also receive the cheque images. Cheques with alterations in material fields (explained in detail later) are not allowed to be processed under the CTS environment.

4. What are the benefits of CTS to customers of banks?

The benefits from CTS could be summarized as follows –

• Shorter clearing cycle
• Superior verification and reconciliation process
• No geographical restrictions as to jurisdiction
• Operational efficiency for banks and customers alike
• Reduction in operational risk and risks associated with paper clearing

5. What is Cheque Standardisation and what does CTS 2010 Standard mean ?

Standardisation of cheque forms (leaves) in terms of size, MICR band, quality of paper, etc., was one of the key factors that enabled mechanisation of cheque processing. Over a period of time, banks have added a variety of patterns and design of cheque forms to aid segmentation, branding, identification, etc., as also incorporated therein a number of security features to reduce the incidence of cheque misuse, tampering, alterations, etc. Growing use of multi-city and payable-at-par cheques for handling of cheques at any branches of a bank, introduction of Cheque Truncation System (CTS), increasing popularity of Speed Clearing, etc., were a few aspects that led to prescription of certain minimum security features in cheques printed, issued and handled by banks and customers uniformly across the banking industry. A Working Group was set-up by RBI for examining further standardisation of cheque forms and enhancement of security features therein. Accordingly, certain benchmarks towards achieving standardisation of cheques issued by banks across the country have been prescribed like – quality of paper, watermark, bank’s logo in invisible ink, void pantograph, etc., and standardisation of field placements on cheques. In addition, certain desirable features have also been suggested to be implemented by banks based on their need and risk perception.

The set of minimum security features would not only ensure uniformity across all cheque forms issued by banks in the country but also help presenting banks while scrutinising / recognising cheques of drawee banks in an image-based processing scenario. The homogeneity in security features is expected to act as a deterrent against cheque frauds, while the standardisation of field placements on cheque forms would enable straight-through-processing by use of optical / image character recognition technology. The benchmark prescriptions are collectively known as "CTS-2010 standard". Indian Banks Association (IBA) and National Payments Corporation of India (NPCI) are co-ordinating with the banks on implementation of the new standard. Accordingly, the cheques issued are tested and certified by NPCI and only after such certification the cheques would be issued to the customers.

All banks providing cheque facility to their customers, have been advised to issue only 'CTS-2010' standard cheques not later than April 1, 2012 on priority basis in northern and southern region which will be part of the northern and southern CTS grids respectively and across the country by September 30, 2012 through a time bound action plan.

6. What is the prescription relating to alterations / corrections on cheque forms ?

The prescription on prohibiting alterations / corrections on cheques has been introduced to curtail cheque frauds on account of alterations in the various fields of cheques and to give protection to customers as well as banks. No changes / corrections can be carried out on the cheques (other than for date validation purposes, if required). For any change in the payee’s name, courtesy amount (amount in figures) or legal amount (amount in words), fresh cheque leaves should be used by customers. This would help banks in identifying and controlling fraudulent alterations. This prohibition is applicable to cheques cleared under the image based Cheque Truncation System (CTS) only and is effective from December 1, 2010. It is not applicable to cheques cleared under other clearing arrangements for the present.

7. What are the precautions required to be taken by the banks / customers to avoid frauds

Banks / Customers should use "CTS 2010" cheques which are not only image friendly but also have more security features. Customers may request/insist their banks for cheque forms that are compliant with the "CTS 2010" standard. They should preferably use dark coloured ink while writing cheques and avoid any alterations / corrections thereon. Preferably, a new cheque leaf may be used in the event of any alterations / corrections as the cheque may be cleared through image based clearing system as enumerated in 15 above. Banks should exercise care while stamping the cheque forms, so that it does not interfere with the material portions such as date, payee’s name, amount and signature. The use of rubber stamps, etc, should not overshadow the clear appearance of these basic features in image. It is necessary to ensure that all essential elements of a cheque are captured in an image during the scanning process and banks / customers have to exercise appropriate care in this regard.

(Refer: http://www.rbi.org.in/scripts/FAQView.aspx?Id=63)

Deadline:

Earlier it was reported that this will be effective from 01-Jan-2013 but today RBI has announced that the customers could continue to use the existing cheque books until 31-Mar-2013 ( Refer: http://www.firstpost.com/investing/new-cheque-norms-you-can-use-your-old-cheque-books-till-march-2013-557824.html)

Sample Image of the new form of Cheque:

Fence and the Crop ?

A news, I read this morning about a Bank staff cheating a woman - http://timesofindia.indiatimes.com/city/chennai/Bank-staff-who-cheated-woman-arrested/articleshow/17367756.cms - set me thinking. Nefarious activities of some bank staff are as old as the banks themselves and there is a constant battle in progress against the prevention of such acts similar to the lines of virus and antivirus vaccines. People are requested not to read between the lines here!!

While the current fraud stems from the greed of the victim in trying to get gold coins without receipt , thus evading taxes, a deeper analysis of other incidents reveal that most of such crimes and duping are due to the negligence, innocence and ignorance of the public, in that order. From time immemorial, right from the days of class banking, people often considered banks as the most trustworthy haven to deposit themselves. It is this belief and the early bankers' dependability and commitment to it that has made banking come this far- from class banking to mass banking. But, it’s a pity that this confidence is getting eroded with the jealousy of a few staff and the sole 'business only' vision of the banks that the customers' safety and security are at times compromised, landing the bank and its name under cloud.

Some of the common cases of 'belief' based frauds I could recollect are:

Ø  Customer just leaves the cash & challan with the bank cashier/ staff not caring to follow up. The staff used to stamp the counterfoil alone and pockets the cash.

Ø  Illiterate people and those in rural areas give cash to the deposit collectors, who do not credit the same into the customer's account

Ø  During deposit mobilization campaign, stray incidents of staff collecting some amount for deposits , which were cyphoned off

Ø  Nonresident customers allowing their dormant savings accounts to be milked by staff

Ø  Giving discharged Deposit receipts to the staff and requesting them to fill up the rest, which goes into the miscreant staff's account

While all the above are exploiting the innocence, ignorance and (misplaced?) belief of the gullible public by a few fraudulent staff, it is a pity that the bank staff's name as a whole is tarred with the same brush. While only such fraudulent activities always remain in mind, acts of some of the staff visiting the house of the old and ailing customers to give cash from their accounts and get life certificates fade into oblivion. This is understandable as only the evils prevail over the good. 

It is a relief that computerization has answered and thwarted most of the above mentioned and other modus operandi.

For those who are educated enough to understand and were only negligent, please make sure that you have Net Banking access and make sure that your transactions are reflected there. Also, enable the messaging services so that all transactions are notified to your mobiles. Nowadays any bank worth its salt is having these facilities.

In all, to avoid such unpleasantness, it is better to remember the advice of my early trainers that in banks there is no room for trust or belief. Better stick to the rules as wisdom is better than valor. 

Life Certificate

Its November and time for the pensioners to visit your pension drawing branch and provide the ‘Life Certificate’. In case you are unable to visit the branch, please check with your bank for alternates.

Remember, banks are liable to stop your pension payable on First December, if the pensioner has not submitted the Life certificate

Banker Kapali welcomes you !

One of the basic tenants of blogging is not to maintain multiple blogs for varied reasons. Though I have been reading about it, every time I find reasons to defy this. Apart from my primary blog of http://kapalicanvas.blogspot.in/ , I started another one   http://chinthikkiren.blogspot.in/, as I wanted to create some exclusive space for my Tamil love.

I have always been proud of my early years of work, a major chunk of it was associated with a bank and at every conceivable moment I relish my years there and at every opportunity, I take some time to think, say and write some good words about Banks, wherever warranted. With the growth of science, technology, and banking and more importantly the speed of Indians to catch up with them, an exciting race is On which is worth following. Of late, I observe that while India in general is progressing on this, banks are gasping to cope up with the steam let out by both the advancement and the consequent expectations of the customer breed.  In the melee, it is the poor, uneducated and old timers of the customer folk who are being taken for a ride by some.

During the past few years, I had occasions to visit many banks for some business transactions and barring few places, the progress, treatment and the service are found wanting. Even the legitimate basic rights of a customer are being denied and the main reason seems to be the ignorance of even some of the educated customers on their rights. Despite being a former Bank employee, even I was at the receiving end, at times even in the bank I served, and it took me some time, effort and hard pressing of rules to wrest my part of justice. At this point only I was wondering there has to be a place where ignorant customers should be educated and informed about their rights, on how to identify and handle the wrong ones being meted to them and after a long thought, I have started this blog to share my few rupees of thoughts.

I plan to focus on branch banking at retail level so that it caters to the section of the people I mean. It is my desire to be careful not to provide sermons, high fundas and only to share basic things in a language that is understood by all, with focus on retail banking. I hasten to add that this forum is not intended to be a place to criticize all banks for everything, but to share specific thoughts which will be based on occurrences or to mitigate such happenings. Visitors to this blog are also invited to pitch in with their banking experiences which are worthy / unworthy of remembrance and the same will be discussed, if desired. You can communicate on this to Kapaleeswaran@gmail.com. Hoping to do my bit of contribution to the innocent bank customers!

If the posts in this blogs are interesting or not interesting, you are also welcome to visit my other blogs at: http://kapalicanvas.blogspot.in/  andhttp://chinthikkiren.blogspot.in/,

Your friendly banker, Kapali