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RBI releases annual report of ombudsman Schemes for the year 2018-19; complaints to BO up 20% in FY19

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On December 17, 2019,According to the annual Report of Ombudsman Schemes for 2018-19,released by Reserve Bank of India(RBI),the volume of complaints received by its 21  Offices of Banking Ombudsman (OBOs) has increased to 1,95,901 complaints in 2018-19 (Fiscal year-FY 19), up by 19.75% (or 32,311 complaints) from the previous year (2017-18), that accounted 1,63,590.RBIKey Points:

i.Even so, the complaints related to unfair practices accounted for a maximum number of cases, its percentage share fallen from 22.10 % in 2017-18 to 19.17 % in 2018-19.

ATM/Debit card issues: ATM (Automated Teller Machine) /Debit card grievances has increased from 15.08 % in 2017-18 to 18.65 % in 2018-19 (36,539 complaints), while those related to pension, levy of charges without notice, credit card related issues and remittance has been decreased.

Mis-selling :The volume of complaints related to mis-selling have has been increased 92.57% to 1,115 in 2018-19 as against from 579 complaints in 2017-18.

Average cost of handling a complaint: The report further states that  the average cost of handling a complaint was Rs 3,145 in 2018-19, which was lower than the average cost of Rs 3,504 in 2017-18.

Disposal rate:The disposal rate was 94.03 % at for 2018-19 as against 96.46 %in 2017-18 due to rise in volume of complaints from the same resource .

Resolved complaints: Through the intervention of OBOs, mediation and conciliation among others, the resolution of complaints increased to 70.40 % in 2018-19 from 65.82 % in 2017-18.

Awards and appeals:There are 98 awards &78 appeals were issued by banking ombudsmen in 2018-19 as compared to 133 and 125, respectively a year earlier(2017-18)..

ii.Ombudsman Scheme for Non-Banking Financial Companies (NBFC-O Scheme): In case of NBFC-O scheme which came to effect on February 23, 2018 in four metro centres Chennai, Kolkata, Mumbai and New Delhi, as many 3,991 complaints were received, as compared to 675 in four months operation during 2017-18.
Here ,unfair practices constituted 40.44 % of complaints received, followed by non-observance of RBI directions (17.21 %), levy of charges without notice (12.63%) and lack of transparency in contract / loan agreement (9.17 %). The disposal rate of NBFC-Os accounted 95.41 % in 2017-18 & 99.10 % in 2018-19.

About Banking Ombudsman (BO):
The Scheme aims to provide a quick and cost free resolution mechanism for complaints relating to deficiency of banking services.

About RBI:
– Mumbai, Maharashtra
Formation– 1 April 1935
Governor– Shaktikanta Das
Deputy Governors– 4 (BP Kanungo, N S Vishwanathan, Mahesh Kumar Jain, 1 is yet to be appointed)