Introduction

The protection of consumers is the need of the hour. The India Parliament
adopted various laws in the interest of consumers for transparency, to fair
competition and to prevent companies from engaging in unfair practices or
fraud. In 1986, the Consumer Protection Act was adopted.
There was a lot of reforms in the banking sector as a dilution of Government
issues, deregulation etc, which resulted in greater competition. Today Bank
went from class to mass and this has led to many problems. But more attention
must also be paid to the protection of consumers in respect with the banking
sector. Help support consumer because it promotes choices, help bring products
or quality services at low rates by reducing inefficiencies. There is a reduction
in the cost of banking services and consumers need to make use of the facilities
available in the changing environment to claim the reduced cost, such as the use
of ATMs, by internet or phone.
The India has a law specifically focused on the protection of consumers
(Consumer Protection Act of 1986), but it's not explicitly for consumers of the
financial sector. Matrix for the financial consumer protection:
1. Banking Codes Standards Office (India), (BCSBI) or the code of fair
practices followed by respective banks.
2 repair mechanism of internal complaint defined by banks
3 Office of the Ombudsman
4 courts
The different functions and roles of the different institutions may sometimes
overlap. When the customer chooses to complain depends on concern of the
customer, location.
The 1986 consumer protection act
Under this Act, article 2, paragraph 1, (o) defines what service is and 'deficit' is
defined in article 2 (1) banking service g. is also covered by the various services
mentioned in this Act. Banking service"here may include receipt of deposits,
payment of premium, ready money, etc. locker facilities. Gap for such services
provided by the Bank may be challenged before the consumer forums. In
accordance with article 2, paragraph 1 (d), the consumer includes a person who
uses or leases a service for review. So anyone who has a bank account or takes a
form of service bank can file complaints under this Act for "deficit in" Web site
or concerning unfair practices by banks. Courts consumer not only compensates
for the failure but also suffered mental agony or harassment met. Here are a few
gaps in banking services set by the commissions of consumption and the courts:
Refusing or holding the amount that was due the deposit fixed after the
deadline
Delay in the payment of the amount on deposits after the deadline
Dishonor of cheques due to error or negligence of the Bank.
Dishonor drafts of the request because of the failure by the leadership of
the Bank.
Refusing loans without no reason in good faith
Cause of abnormal discharge the loan payments delays
Charge interest at a higher rate than what was specified in the loan
agreement.
Failure in the return of securities, even though the loan is repaid.
Failure of the Bank to honour guarantee, if the request was directed by
warranty.
The responsibility is on bank if items in the locker are lost
loss of customers due to the unavailability of securities in the Bank's
premises
Closure of bank account without any instructions in this regard to the
account holder
Refusing the cheque book facility to the customer only due to the fact that
the minimum balance has not been maintained
Failure of bank teller to account money deposited at the counter with him
(vicarious liability)
Rude behavior of the leaders of the Bank resulting in a gene or agony
mental customers
Without even requiring the refund by giving notice to "deal with the
auction or make the payment".
Failure to return the unpaid cheque
The banking ombudsman scheme
As an alternative dispute settlement mechanism, this program launched in 1995
had been changed by RBI to bring within its scope, the growing number of
complaints. Banking Ombudsman is basically a manager appointed by RBI.
Since then, it is used as a main forum for dispute settlement. He is not bound by
precedent and in some cases is also not bound by the rules of procedure and
decisions are based on specific cases. Also the mediator Bank offices to create
awareness camps, exhibitions, advertisements etc. But there is also the fact that
the regime is limited to only 27 grounds (including the internet banking) and it
is therefore necessary to broaden its scope. The scheme is entirely managed by
RBI. At present, there are 15 offices in the countries where the complaint can be
launched due to the deficiency. Now the customer may complain under BOS if
the banks do not respect the code of fair practices of lenders or code issued by
BCSBI which is the Code of commitment by the Bank to customers. BCSBI
highlighted 2 sets of codes, Code of commitment by the Bank to clients and
others to the Micro or small businesses. But despite the fact that these codes
have now been adopted by banks and have been in existence for such a
considerable amount of time, the quality of the service provided still needs a lot.
It's something very apparent many complaints received in the country under the
regime of the banking Ombudsman.
Charter of rights of the customer
He is a recent measure taken by RBI on the protection of consumers. It includes
various principles as follows:
Right to fair treatment: entitled to courtesy treatment is with both the
provider of services, as well as with financial clients. Also, no customer
should be made evidence of discrimination based on age, sex, caste,
religion or physical capabilities.
Right to fair, Transparent and honest: service provider must make every
effort to ensure that contracts supervised by it are transparent in nature
and are such that can be understood easily and is properly communicated
to the ordinary people. Price of the product, the various risks associated
with them and various conditions that govern customer responsibilities
during the lifecycle of the product, must be disclosed. Also client should
not be subject to undue influence, or practices that are unfair or unjust
Right of qualities: customer needs should keep in mind while offering
products (needs based on the financial situation of the customer).
Right to privacy: personal information of the client should be
confidential, unless there is consent or if the information is required by
law. They have right to protection on anything that infringes upon their
privacy.
 Right to redress of grievances: the customer has the right to hold the
financial services provider responsible for the products. Financial
services providers must inform customers about their policy regarding the
rights and duties in the event of such events.
As said by the Dr. Raghuram Rajan on February 15, 2016 to 'annual banking
mediators ' Conference, RBI will take incognito visits to banks for control of
customer complaints culture prevailing in the banks. Secondly he also carried
on the Charter of client rights, by declaring that the RBI will be undertaken
reviews on its implementation. Thirdly, he insisted on the banks to implement
the mechanism of redress of grievance in banking. He also stressed on the
reduction of the cost of repair of the grievances and to allow customers to use
repair machines of anywhere at any time using high level automation.
An important component about the customers is that special customers as
seniors, students, or vulnerable should be given special attention to financial
service providers. Next change that may be required is in online transactions,
where a particular code of conduct must be implemented, with the procedure of
complaint, passive, etc.. Financial literacy should also be encouraged. At the
international level, financial awareness is given top priority in the financial
consumer protection. Also behavior changes should be made in the
organizations and employees at all levels must focus on the protection of
consumers.
In the constitution of the India, social and economic justice is an important
component in which a consumer justice and protection is also a part. It stay
number of laws have been adopted by the Indian Parliament as acts of drug
(control), 1950; Acts of prevention of the adulteration of food products, 1954;
Acts of essential commodities, 1955; Acts essential Services maintenance,
1968; Commercial transactions and brands, 1958; MRTP is, 1969, etc.. But all
these acts are still failed to protect the interests of small consumers. Under these
acts typical stay procedures and litigation, too lengthy and costly. At the same
time there remain so many of these acts, but because of the procedure and the
time long, common facilities
man (consumer) will avoid the it. The General Assembly of the United Nations
adopted a resolution No. 39/248 04/08/1985 adopter of guidelines relating to the
protection of consumers. Further, which establishes a framework for the
Governments of developing countries, for the formulation of consumer
protection policies and legislation.
Finally in 1986, the Indian Parliament passed the protection of consumers is,
1986, as its name suggests, to protect the interests of consumers and to provide