The Reserve Bank of India’s (RBI) Deputy Governor, M. K. Swaminathan, has urged banks and non-banking financial institutions to reorient their grievance redress frameworks in order to facilitate and strengthen the role of the Internal Ombudsman. This call for action comes as a means to enhance customer protection and ensure effective resolution of complaints within the financial sector.
Swaminathan emphasized the significance of the Internal Ombudsman in addressing customer grievances and reinforcing trust in the banking and non-banking sectors. By reevaluating and revamping their existing grievance redress frameworks, financial institutions can better align with this objective.
The Internal Ombudsman serves as an independent authority responsible for reviewing and resolving customer complaints that have not been adequately addressed by the frontline staff or the grievance redress mechanism already in place. This additional layer of oversight acts as a safeguard against potential lapses and ensures fair treatment for customers seeking resolution.
In light of the evolving needs and expectations of customers, banks and non-banks must prioritize the establishment of robust internal mechanisms to address grievances effectively. Swaminathan emphasized that these mechanisms should function independently and possess the necessary authority to resolve complaints promptly and impartially.
Furthermore, Swaminathan emphasized the importance of creating awareness among customers about the existence and efficacy of the Internal Ombudsman. Customers need to be aware of their rights and avenues available for grievance redressal. The promotion of transparency and open communication channels can foster trust and confidence among customers and strengthen the overall regulatory framework.
To further bolster the effectiveness of the Internal Ombudsman, Swaminathan highlighted the necessity of periodic reviews of the performance and functioning of these internal mechanisms. Regular assessments will help identify areas for improvement and enable financial institutions to adapt to changing dynamics and customer requirements efficiently.
While urging banks and non-banks to embrace this shift and enhance their grievance redress frameworks, Swaminathan acknowledged that the role of technology is crucial in this process. Leveraging technological advancements can streamline complaint resolution, reduce processing time, and facilitate a seamless experience for customers.
In conclusion, the RBI’s Deputy Governor calls for banks and non-banking financial institutions to reorient their grievance redress frameworks to strengthen the role of the Internal Ombudsman. This proactive approach aims to enhance customer protection, ensure fair and efficient complaint resolution, and foster trust in the financial sector. By prioritizing the establishment of robust internal mechanisms, creating awareness among customers, and leveraging technology, financial institutions can adapt to evolving customer needs and maintain a strong regulatory framework.
