Banking code elicits poor response

Banks' response to Banking Codes and Standards Board of India (BCSBI) has been slow with just four signing up so far. The BCSBI was launched on July 1 by Reserve Bank of India (RBI) governor Y V Reddy.

The banks which have signed memorandum of understanding with the board are Canara Bank, Arab Bangladesh Bank, Bank Of America and Societe Generale, sources said.

BCSBI has been established based on a similar set-up in the UK which oversee the banking code "� a voluntary code evolved by the British Bankers' Association (BBA) and adopted by all banks there.

None of the private sector banks have signed the memorandum of understanding (MoU) with the board. The MoU binds a financial services provider to follow a voluntary code "� a minimum standard of banking practices "� while dealing with individual customers. The banks should follow the code in their day-to-day dealings with their customers.

The banks are required to register with the board as members before they adopt the code. Once the banks start implementing the code, BCSBI will monitor the process.

A senior private banker said the banks are being cautious in signing up for adopting the code as they first want to put in place a fool-proof systems.

"If there exists a lacunae at some point, it could lead to unsavoury incidents. Banks want to avoid such a situation," the banker said.

The banks are required to make necessary changes in certain policies and procedural aspects around their products and services.

BCSBI members would also have to establish appropriate grievance redressal mechanisms, such as help desk/ helpline at the branch, code compliance officer at each controlling office and display his/ her name and contact number at each branch as well as the name and address of the banking ombudsman.

Every aggrieved customer has to first approach the help desk of the concerned branchank and in case the issue is not resolved, then to the code compliance officer.