Deregulation of Savings Bank Deposit Rate – My views
Interest is only a small component in the Saving Bank experience. Apart for the Interest Rate, other features differentiate the Saving Bank Account products. Some of the features are : –
01) ATM Access fees
02) Maintaince of Average Balance-monthly or quarterly
03) Cheque Retrun Charges
04) Cheque Book Issuance charges
05) Funds Sweep
06) Locker rental discounts
07) Demat account fees discounts
The ROI on SB Deposit is regulated by Reserve Bank of India. Now, Reserve Bank of India, is seeking views on de-regulation of the same.
Transparency in Charges
|The main disconnect between the Customers and the Bank staff; will be on the Charges debited to the account. Hence, utmost transparency will aid in minimal customer dissatisfaction.
A simulator will be immense help, to view the estimated future charges and take an informed decision.
Lock in period of 3 months on launch of new SB products, wherein no Terms and Conditions can be modified except the Interest Rate
|This is to ensure that the T&C, especially for new SB Products are not changed in the early stages of the product.|
Common dates for modification of Terms and Conditions, except the Interest Rate
|01) This will minimize frequent modification in the T&C
02) Common Dates, will also assist the customers to take informed decisions and to keep track of the T&C
03) The industry wise common dates can be quarterly
Proper intimation of modifications to T&C
|The mode of intimation can be electronically, provided it is highlighted in the hard copy of the Statement of Account mailed to the customers.
SMS/Email alerts should clearly mention the path of the document on the Bank’s website.
The modifications should be clear viz
Detailed Debit Advice to be part of the ac statement.
|The debit narration should be clear and not vague like Charges for the period ——- to —— or on similar lines.
Each type of debit charge should be separate for easy understanding.
Charges might be on account of a) non-maintenance of stipulated Balance/average balance.
b) ATM withdrawal charges
c) Cheque Book charges etc
In case the charges are not debited are deferred and not debited immediately, a SMS to be preceded before the charges are debited.
In case, charges could not be debited due to insufficient balance in the account and are ‘on hold’, the same to be reflected as an annexure to the Statement of Account. This can be an electronic mode, to minimize the cost of printing.
Historical Debit Advices, to be available on Net Banking
|This will reduce the customer interface with human touch points and enable the bank customers to devote time to other banking needs of the customers.|
Free Debit Advices to be available to customers at base branches, at least for the last 4 quarters
|A customer service initiative|
Free historical charges slip to be available via mail on request
|A customer service initiative and also minor recon issues can be resolved immediately.|
Dedicated email id to quickly resolve the SB account queries
|In the initial years, it is envisaged that the customer queries will be on the high side, and a dedicated email id, will enable the queries to be resolved quickly.|
Interest calculation sheet, similar to Interest calculation sheet in OD accounts to be part of the account statement
|This is a necessity, from the customer’s audit angle too.|
Interest Payment to be shifted to quarterly periods, instead of the current half-yearly mode. Monthly is the best option
|The interest payouts should be in par with the service charges debit. In case the accounts are debited quarterly/monthly for non – maintenance of the stipulated balance/average balance, it is only fair that the Banks should also pay the interest quarterly/monthly.|
Account number should be same, when the account is moved from one product to another product, in the same bank.
|This will ensure that the account numbers registered at other institutions viz Demat, Mutual Fund, Electronic Clearing Service, NEFT, RTGS, Salary Credits remain the same, and the customer is not put to trouble and run around to change his/her bank account.|
No charges to be levied, in case the customer desires to shift his/her SB account from one product to another product.
|As the account is within the bank only and service charges as applicable to the new SB Product will be borne by the customers, the customer should not be charged for shifting his/her SB account from one SB Product to another SB Product.
Net banking site too have the shift option of the SB Accounts from one SB Product to another SB Product
|14||Product Brochures of all SB products-whether active or inactive to be available on the Bank’s site||
Customer Service Initiative. It is observed that the Banks delay in updating their website, with the Product Brochures. The product brochures are available only at the branches.
There is no cost involved in the display of the Product Brochures on the Bank’