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Presentation on Model Policies of IBA on Grievance Redressal Mechanism & Collection of dues & Repossession of Security. Model Policy For Grievance Redressal in Banks. The Policy for grievance redressal should provide for: Aims and Objectives of the Policy;
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Presentation on Model Policies of IBA on Grievance Redressal Mechanism & Collection of dues & Repossession of Security
Model Policy For Grievance Redressal in Banks • The Policy for grievance redressal should provide for: • Aims and Objectives of the Policy; • Machinery for handling Customer complaints/ grievances; • Mandatory display requirements; • The level of officials responsible for resolution of Grievances; • Specific time frame to be set up for handling complaints; • Personal interaction with customers by bank’s staff; and • Sensitizing operating staff on handling complaints.
Aims and Objectives of the Policy • Aims at minimizing instances of customer complaints and grievances. • Ensure prompt redressal of customer complaints and review mechanism. • The policy should follow the undernoted principles: • Customers should be treated with courtesy and fairly at all times. • Customers should be fully informed of avenues to escalate their complaints/grievances within the organization and their rights to alternative remedy. • To treat all complaints efficiently and fairly. • Employees should work in good faith and without prejudice to the interest of the customer.
Machinery for Handling Customer Complaints/ Grievances • Customer Service Committee of the Board - formulate Comprehensive Deposit Policy. • Standing Committee on Customer Service - Chaired by the Managing Director/ED - evaluate feed-back on quality of customer service; ensure compliance of all regulatory instructions regarding customer service; consider unresolved complaints/grievances; submit report on its performance to the customer service committee of the board at quarterly intervals. • Nodal Officer and other designated officials to handle complaints and grievances - responsible for the implementation of customer service and complaint handling for the entire bank.
Mandatory Display Requirements • Appropriate arrangement for receiving complaints and suggestion. • Name, address and contact number of Nodal Officer(s). • Contact details of Banking Ombudsman of the area. • Code of bank’s commitments to customers/Fair Practice code.
The level of officials Responsible for resolution of Grievances • Branch Manager is responsible for the resolution of complaints/grievances. • Branch Manager to be responsible for ensuring closure of all complaints. • If Branch Manager cannot resolve the problem, he can refer it to Regional/ Zonal office. • Regional/ Zonal office can further refer the matter to the Nodal Officer.
Specific Time Frame to be Set up for Handling Complaints • Complaints to be analyzed from all possible angles. • Specific time schedule to be set up for handling complaints at all level. • Complaints which require time for examination should invariably be acknowledged promptly. • Branch and zonal office must send action taken report on complaints to head office on monthly basis.
Personal Interaction with Customers by Bank ‘s Staff • There should be structured customer meets. • Feedback from customers to be considered valuable input.
Sensitizing Operating Staff on Handling Complaints • Staff to be properly trained to handle complaints. • Imparting soft skills for handling customers. • Nodal officer to ensure internal machinery for handling complaints/grievances operates smoothly and efficiently at all levels. • Feed backs on training needs of staff to be given to the HR Dept.
Model Policy on Collection of Dues and Repossession of Security • The Policy for collection of dues and repossession of security should provide for: • Aims and Objectives of the Policy; • General Guidelines; • Medium of giving notice to the borrowers; • Repossession of security; • Valuation and Sale of property; • Opportunity for the borrower to take back the security; and • Engagement of recovery agents.
Aims and Objectives of the Policy • Built around dignity and respect to customers. • Built on courtesy, fair treatment and persuasion. • Aims at recovery of dues in the event of default and not whimsical deprivation of the property. • Recognize fairness and transparency in repossession, valuation and realization of security. • Process adopted for the recovery of dues to be inconsonance with the law.
General Guidelines • Customers to be contacted primarily at the place of his/her choice. • Identity and authority of persons authorized to represent bank for follow up and recovery of dues to be made known to the borrowers. • The bank to respect privacy of its borrowers. • Communication with borrower in simple business language and bank to adopt civil manners for interaction with borrowers. • Timing of Contact with borrowers. • Borrower’s requests to avoid calls at a particular time or at a particular place to be honoured as far as possible. • The bank will document the efforts made for the recovery of dues and the copies of communication sent to customers.
Medium of giving notice to the borrowers • Written communications, telephonic reminders or visits by the bank’s representatives to the borrowers place. • Not to initiate any legal or other recovery measures including repossession of the security without giving due notice in writing. • Any genuine difficulties expressed/disputes raised by the customer to be considered before initiating recovery measures
Repossession of security • Repossession of security aimed at recovery of dues and not to deprive the borrower of the property. • The recovery process should involve repossession, valuation of security and realization of security through appropriate means. • All these to be carried out in a fair and transparent manner. • Repossession will be done only after issuing the notice. • All reasonable care for ensuring safety and security of the property after taking custody.
Valuation and Sale of Property • To be carried out as per law and in a fair and transparent manner. • Right to recover balance due only after the sale of the property. • Excess amount to be returned to the borrower. • In the case of hypothecated assets after taking possession if no payment is forthcoming a sale notice of 7 days time to respond will be sent to the borrower. • As per SARFAESI Act, 30 days notice of sale to be sent. • Public auction or tender to be published in two lending newspapers, atleast one to be local vernacular paper.
Opportunity for the Borrower to Take Back the Security • Bank to consider the handing over the possession of property any time after repossession and before sale of the property. • Banks to consider arrangements made by the borrower to ensure timely repayment before handing over possession.
Engagement of Recovery Agents • Appointment of Recovery Agent as per regulatory guidelines. • Name and address of Recovery Agents in the panel of the Bank to be displayed on the website. • Only Recovery Agents from the approved panels will be engaged by the bank. • The identity of the agent to be disclosed to the borrower. • The Recovery Agents engaged by the bank will be required to follow a code of conduct covering their dealings with customers.
