Centre outlines steps to make PSB management more customer-friendly

While a leading insurance company had lost significant market share recently, PSU banks are under pressure from poor performance and rising bad loans.

The government is taking a serious view of the rising number of customer grievances in state-owned financial entities and has outlined measures to make the top management of these institutions more customer-friendly

In a recent letter to the chiefs of state-owned banks and insurance companies, the finance ministry has asked the chairmen and managing directors of financial entities to directly supervise the issue of customer grievances. Currently, one officer in the rank of general manager or even below looks after grievances in many financial entities.

As per the new advisory, there should not be any need for customers of banks to approach the government through members of Parliament and MLAs. Any grievance against the bank should be attended by the banks at their level only. Free access to top management should be allowed and proper response mechanism and communication system should be put in place. The contact numbers of the concerned authorities should be advertised through all available means, the letter says. The direct intervention by the CMD is expected to lead to an early resolution of the complaint and make public sector entities more customer-friendly.

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While a leading insurance company had lost significant market share recently, PSU banks are under pressure from poor performance and rising bad loans.

The finance ministry last week set up a task force led by former PFRDA chairman D Swarup for conducting preparatory work for the proposed Financial Redress Agency. This follows the suggestions of the Financial Sector Legislative Reforms Commission headed by Justice BN Srikrishna.

The Commission’s report had said a mere ‘buyer beware’ approach is not adequate in finance; regulators must place the burden upon financial firms of doing more in the pursuit of consumer protection.