Banks to insurers: Using the ombudsman system to get complaints resolved

A guide to how banks, insurers, brokers and tax officials are supposed to listen to you

Consumer complaints to the Reserve Bank of India (RBI) rose to 703,000 in 2022-23, up 68 per cent over the previous year, according to a recent report by the banking ombudsman. The RBI ombudsman addresses complaints regarding deficiencies in 

banking services.
 

Markets regulator Securities and Exchange Board of India (Sebi) discontinued its ombudsman in July 2023. “In its place, Sebi has introduced an online complaint system called ‘SCORES’ (Sebi Complaints Redress System), where complaints can be filed against securities market players, companies, intermediaries, and market infrastructure institutions,” says Vidhan Vyas, founder, Vyas Legal.

 

Banking
 

A complainant cannot initiate the grievance resolution process by directly approaching the bank ombudsman. “A complainant should first contact customer care, file an online complaint via email or the bank’s website, or visit a branch. If the issue remains unresolved, it should be escalated to the grievance redress team,” says Gaurav Aggarwal, chief product officer-credit products, Paisabazaar. If the customer care team is unable to help, contact a grievance redress officer (level 1) or a nodal officer. If it still remains unresolved, escalate the matter to the principal nodal officer.
 

Contact the RBI’s banking ombudsman next. “Adhere to the bank’s grievance redress policy. Do not skip the levels in the redress mechanism. Only if the bank deviates from its policies and no amicable resolution is provided within the pre-defined period should one reach out to the RBI ombudsman,” says Aggarwal.
 

When contacting the ombudsman, state the bank’s name and address, provide documents supporting the complaint, and state the extent of your loss.

 

Mutual funds
 

If you have a grievance against a mutual fund house, approach it first. “Contact the fund house through a call to their customer services team, or via email (displayed on their website). You may also walk into their official point of contact centres or the contact centres of the Registrar and Transfer Agent,” says Rajen Kotak, investor relations officer, ICICI Prudential Mutual Fund.

Every fund house has an escalation matrix through which a complaint can be escalated if it is not resolved satisfactorily in the first instance. If you are still not satisfied, approach Sebi through its SCORES platform. Choose the query type and name of the fund house, and provide the other details that are asked for.

 

Stock brokers
 

Brokers must display a complaint ID in their offices, on their websites, and account opening forms. Send an email to this ID to complain.
 

“If a broker does not satisfactorily address a grievance, complain to the relevant stock exchange by providing your client ID and specifying the complaint category,” says Shrey Jain, founder and chief executive officer, SAS Online.
 

Investors can also file a complaint at SCORES. “Submit complaints to exchange platforms or regulators within the stipulated period to avoid complicating the resolution process,” says Jain.

 

Insurance
 

Contact the insurer first. If your complaint is not resolved, go to its grievance redress cell and grievance redress officer. “File your complaint in writing with all supporting documents. Ensure that your complaint is acknowledged. Insurers are expected to resolve grievances within 15 days,” says Tarun Mathur, co-founder and chief business officer, general insurance, Policybazaar.com.
 

Approach the ombudsman’s office if you are not satisfied with the insurer’s resolution. “If your claim is rejected, repudiated, or partially settled, you may contact the insurance ombudsman within one year,” says Mathur. If a settlement is reached during a hearing before the ombudsman, it becomes the award. If not, the award is decided on merit. Only the complainant can escalate the grievance to another forum or court.
 

If the complaint remains unresolved after two weeks, escalate it to the Insurance Regulatory and Development Authority of 

India (IRDAI).  “Register a complaint on IRDAI’s Bima Bharosa portal,” says Naval Goel, chief executive officer, PolicyX.

 

Tax matters
 

The Income-Tax ombudsman, established in 2003 to handle tax grievances, has been withdrawn and alternative mechanisms have been set up.
 

“The I-T Department’s e-Nivaran initiative provides a paperless online grievance redress mechanism. It is integrated with the department’s portal to ensure direct handling by the relevant authorities. It addresses a range of issues, including refunds and I-T return filings,” says Sanjay Jain, a senior advocate at the Supreme Court. Grievances are typically resolved within 20-45 days.
 

The Centralised Public Grievance Redress and Monitoring System is an online portal for submitting and tracking grievances. It allows citizens to report issues to the relevant departments and monitor progress. The system is directly monitored by the higher authorities.
 

“Taxpayers may also approach the higher authorities within the tax department, such as the commissioners or the Central Board of Direct Taxes (CBDT), for issues that require higher-level intervention,” says Jain.
 

Finally, customers can approach the Income Tax Appellate Tribunal, the High Courts, and the Supreme Court for legal redress.