Banks with over 10 branches to have internal ombudsman: RBI
The Reserve Bank of India (RBI) yesterday asked all scheduled commercial banks with more than 10 branches to appoint an internal ombudsman (IO). The apex bank has, however, excluded regional rural banks (RRBs) from appointing IOs. The internal ombudsman scheme was introduced by the RBI to strengthen the internal grievance of banks and to ensure that the complaints of the customers are redressed.
RBI reviewed the arrangement in form of 'IO Scheme, 2018'
In order to further enhance the independence of the IO and also to strengthen the monitoring system over the functioning of the IO mechanism, the RBI, in a release, said it has reviewed the arrangement in the form of "Internal Ombudsman Scheme, 2018".
IO to review customer complaints partly/wholly rejected by banks
"The IO shall examine customer complaints which are in the nature of deficiency in the bank's service, that are partly or wholly rejected by the bank," the RBI said. The scheme covers appointment/tenure, roles and responsibilities, and oversight mechanism for the IO. The implementation of IO Scheme, 2018 will be monitored by the bank's internal audit mechanism apart from regulatory oversight by the RBI.
Customers don't need to approach the IO directly: RBI
The RBI said the customers need not approach the IO directly, as the banks shall internally escalate all complaints, which aren't fully redressed to their respective IOs before conveying the final decision to the complainant. In May'15, the RBI had advised all public sector and select private and foreign banks to appoint an IO as to review complaints that were partly/wholly rejected by banks.
