2019 March

A couple of issues back, I had highlighted about Customer Satisfaction & Customer Delight – good service topped up by simple yet thoughtful gestures. This time I am constrained to highlight about Customer Saga, thanks to mindless processes and lack of understanding of issues by banking officials.

S.Aggarwal was battling a rare, fatal illness that put him completely out of gear and cost him his company. Registrar of Companies struck off his company in 2017 for non-filing of financial statements for 3 years in a row. He realised this when his bank promptly froze his account without giving any notice. It took us nearly 18 months to get him a revival order from NCLT which clearly gave him a 30 day deadline to complete the pending filings with ROC. Obviously he had to use the bank balance to pay the filing fee running into lacs. Aggarwal had to struggle for nearly 25+ days to get his account reopened. Beg, plead, threaten the bank to let him use the funds and complete the filings. It was almost touch and go as we kept chasing him to adhere to the deadline. Wonder why it should take so long to reopen your bank account when there is a clear court order ! As usual the branch level officials either did not know what to do or their process involved taking permission from the central office with umpteen number of documentation. When company strike off has become the order of the day for the past 2 years, can the bankers not get their act together and educate branch level personnel about how to deal with these matters swiftly ?

A.Varma received foreign investment equivalent to Rs. 90,000 from his co-founder. After completing the mandatory RBI reporting he got a ridiculous direction from them asking him to refund a piddle amount of …….take a guess, try……yes, a royal sum of Rs. 267 ! Earlier there was an unwritten understanding we had from RBI that irrespective of the amount of foreign investment received, upto Rs. 2000 could be adjusted as exchange rate fluctuation. Wonder what happened to that internal guideline ? While Varma didn’t have any issues refunding 267 in USD to his co-founder, the bank seemed to. So it appeared. Instead of refunding the amount immediately, they asked for umpteen number of documents and declarations, which they already had since the money came into their bank in the first place. A helpless Varma had to spend hours coordinating for this to send out a small 267 rupees. Else he would be violating a Company Law provision that requires excess share application money to be refunded within 60 days. Banks have a responsibility as Authorised Dealers to guide their clients about FEMA matters but far from guiding they need guidance themselves. So much for their processes and service !

Sheetal gave up her high-paying corporate job and following her passion in education, set up a not-for-profit Section 8 company recently. Soon after, her saga of opening a bank account started. The first salvo fired by the bank at her was a question “You say yours is a section 8 company but the incorporation certificate does not mention this section anywhere. Instead there is reference to section 7. Clarify”. How on earth is a commoner expected to know the legal provisions ? In the first place why is she responsible for how a certificate, digitally signed by a ministry official is issued ? Again why this question from a bank official when he had to figure out the answer internally ? Wasn’t it his lack of knowledge that he had to look for ‘NPL’ in the CIN number of the company ? Again, the flustered entrepreneur had to write back to us and convey the clarification to the banker. Not sure if he is continuing to fire more salvos or has opened the bank account. While most private sector banks are tech enabled, either the employees are not trained well enough or there are just too many unnecessary and unreasonable processes and hierarchy, rendering banking experience into Customer Saga.

The experiences of Aggarwal, Varma & Sheetal (names changed) are real-life and recent and in a seemingly ‘informed city’ like Bangalore. Imagine the situation in other smaller towns. While I do acknowledge several instances of helpful banking personnel and user-friendly systems, the ‘other category’ seems to be on the rise leading to Customer Ire. It is time Ease of Doing Business climbs down from its ‘aerial ranking’ and touches ‘ground zero’ that can be felt and seen !!