Banks told to pen customer policy

The Reserve Bank of India (RBI) will advise banks to formulate a transparent and comprehensive policy stating the rights of depositors with a special focus on small depositors.

The deadline for formulating the policy is July 31. The central bank said the policy should incorporate all aspects of operations of deposit accounts, charges leviable and other related issues to facilitate interaction.

The Reserve Bank will also issue a master circular on all aspects of maintenance of deposit accounts and settlement of claims of deceased depositors after undertaking a thorough review of these areas in consultation with the Indian Banks' Association (IBA).

In keeping with the Tarapore committee report, the Reserve Bank said the banks will have to appoint quality assurance officers who will ensure that the intent of policy is translated into content and its eventual translation into proper procedures.

The IBA may also be asked to issue a comprehensive operational procedure which could be considered by banks and to evolve a model deposit policy, recognising the rights of the depositor and circulate it among its members.

Meanwhile, the RBI has put in place a system of imposing penalties on banks for infringement of customers rights and obtain feedback from customers about the services being rendered in the central bank's offices.

The central bank has also standardised application for savings bonds and has made it uniform across all its offices as well as agency bank branches and the form was available on RBI website following recommendations of S S Tarapore committee on procedures and performance audit on public services, said an RBI statement today.

A citizens' charter has been updated and publicised for all its departments handling government business, it added. It has issued a master circular containing instructions relating to handling of government and relief or savings bond businesses.

The Tarapore committee examined RBI's procedures and performance under four different areas affecting individual customer transactions. These were foreign exchange, Government transactions, banking operations and currency management. The Tarapore Committee submitted its reports between January and April 2004.