Banking Ombudsman

Banking Ombudsman

The Scheme is created with the goal of facilitating the handling of complaints pertaining to specific services provided by banks, as well as the satisfaction or resolution of such complaints.

1. Short Title, Beginning, Extent, And Application

•   The Banking Ombudsman Scheme, 2006 may be referred to as this Scheme.
•   It shall enter into force on the date specified by the Reserve Bank.
•   It shall apply to the entire country of India.
•   The Scheme shall be applicable to a bank’s operations in India as stated in the Scheme.

2. Suspension Of The Plan

•   If convinced that it is expedient, the Reserve Bank may, by order, suspend the execution of all or any of the Scheme’s provisions, either broadly or in regard to any particular bank, for the time indicated in the order.
•   The Reserve Bank may, under the order, prolong the term of any suspension issued as aforesaid by such duration as it deems appropriate.

3. Description

•   The term ‘award’ refers to a decision made by the Financial Ombudsman Service in compliance with the Scheme.
•   The Acting Governor in the head of the Reserve Bank’s Department in charge of administering the Scheme is referred to as the Appellate Authority.
•   An ‘authorized representative’ is a person who has been lawfully appointed and authorized by a complaint to act on his behalf and represent him in proceedings under the Scheme before such a Banking Ombudsman for review of his complaint.
•   The term ‘Banking Ombudsman’ refers to any person elected under the Scheme’s Clause 4.
•   ‘bank’ means a ‘banking company,’ a ‘corresponding new bank,’ a ‘Regional Rural Bank,’ a ‘State Bank of India,’ a ‘Subsidiary Bank’ as defined in Section 5 of the Banking Act, 1949 (Act 10 of 1949), or a ‘Primary Co-operative Bank’ as defined in section (c) of Section 56 of that Act and included in the Second Schedule of the Reserve Bank of India Act
•   A ‘complaint’ is a written or electronic submission expressing a grievance alleging a shortfall in banking service, as defined in section 8 of the Scheme.
•   The Reserve Bank of India, as established under Section 3 of the Reserve Bank of India Act, 1934, is referred to as the ‘Reserve Bank’ (2 of 1934).
•   ‘the program’ refers to the Finance Act Scheme, which was established in 2006.
•   The term ‘secretariat’ refers to the office established pursuant to sub-clause (1) of Regulation 6 of the Scheme.
•   The term settlement refers to a contract reached by the parties through conciliation or mediation in accordance with paragraph 11 of the Scheme.

Banking Ombudsman’s Jurisdiction, Powers, And Duties Authority And Jurisdiction

• The Reserve Bank shall designate the territorial boundaries to which each Banking Ombudsman designated under Section 4 of the Scheme’s powers shall extend.
• In collaboration with the Reserve Bank, the Banking Ombudsman shall develop an annual budget for itself and shall exercise expenditure powers within the authorized budget in compliance with the Reserve Bank of India Expenditure Rules, 2005.
• The Banking Ombudsman shall send to the Governor of the Reserve Bank a report containing a general review of his Office’s activities during the preceding fiscal year, as well as such other information as the Reserve Bank may direct, and the Reserve Bank may if it considers it necessary in the public interest, publish the report and the data gleaned from the Financial Ombudsman Service in such consolidated form or otherwise.

Grievance Redressal Procedure

 COMPLAINT GROUNDS

Any person may register a grievance with the Financial Ombudsman service having jurisdiction on any of the following bases alleging a shortcoming in banking, including internet banking or other services.

• Non-payment or undue delay in paying or collect of cheques, drafts, invoices, etc.;
• Non-acceptance of small denomination notes tendered for any reasons, without good reasons, and imposing commission in regard thereof;
• Non-acceptance of coins offered without adequate cause, and imposing commission in regard thereof;
• Non-payment or excessive delay in payment of inbound remittances; and
• Failure to provide or delays in issuance.

Any individual who has a problem against a financial institution on just about anyone or more of the grounds listed in Clause 8 of the Plan may register a complaint with the Banking Ombudsman whose area the branch or office of the bank complained about is situated.

Conclusion

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The Banking Ombudsman shall receive and recognize complaints filed on the grounds specified in clause 8 concerning deficiencies in banking or other services, and shall enable their satisfaction or settlement through agreement, conciliation, and arbitration between the bank involved and the aggrieved parties, or by having to pass an Award in accordance with the Scheme. The Financial Ombudsman must have overall supervision and administration of his Department and be accountable for its functioning.