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The Reserve Bank today asked lenders to stop differentiating between home-branch and non-home branch and pricing of services thereof, saying such a system should not continue with core banking solution (CBS) in place
The apex bank also asked them to price retail loans fairly.
"It is observed that some banks are discriminating against their own customers on the basis of one branch being designated as the 'home branch' and other branches being referred to as 'non-home' branches where different charges are levied for the same products/services," the Central Bank said in its annual policy announcement.
The monetary authority further said with the CBS in place, "its expected that bank customers will be treated uniformly at any sales or service delivery point."
Bank customers should be treated "fairly and reasonably" sans any discrimination, it said, advising all the banks to stop the practice of charging customers for availing of basic services from non-home branches.
The RBI said it has observed "wide variations" in the rate of interest charged to retail borrowers even when the loan is sanctioned on the same day.
This was in spite of the introduction of the more transparent base rate regime in July 2010.
"The very wide variation in rates of interest charged by banks on retail loans to different borrowers on the same day cannot possibly be attributed to customers' risk profiles," it said, asking banks to take remedial action.
Lenders should have management oversight on such practices and should also frame policies to ensure that retail loan pricing is "transparent, realistic, and related to the risk perception of the borrowers," the RBI said.
