Was your account debited even when the ATM failed to dispense cash? Did your banker levy excessive charge on your credit card and refuse to reverse it?

Well, you are not alone. The ‘Banking Ombudsman Annual Report’ for 2011-12 released in January shows at least 14,492 bank customers had card-related complaints during this period, 9,350 of which pertained to ATM/debit cards alone.

Grievances relating to cards outnumbered others such as wrongful interest rates and charges on loans, lost cheques or delays and non-receipt of pensions.

Cards were the single biggest grounds on which bank customers felt short-changed by their banks, and responded by taking their case to the banking ombudsman.

In 2011-12, card-related grievances formed one-fifth of the total complaints.

At least half the cases came from three major banks — SBI, ICICI Bank and HDFC Bank.

This is followed by Punjab National Bank, Standard Chartered, and Axis Bank.

Grounds for complaint

Major problems that clients faced were wrong debits to accounts, skimming of cards, unsolicited credit cards and insurance policies, authorisation of loans over phone, erroneous billing, and charging an annual fee on cards despite originally being offered as ‘free’.

Amounts involved

The amounts involved have sometimes been quite substantial too.

For example, the report discusses a case where around Rs 5 lakh was fraudulently withdrawn from a customer’s account through an ATM.

In another instance, Rs 18,81,743 was siphoned off from an NRE account through unauthorised online fund transfers/withdrawals.

With the amount at stake being high and banks pointing fingers at the customer for compromising on security, such instances have forced customers to approach the ombudsman.

In both the aforementioned cases, the ombudsman discovered lapses on the part of the bank and directed them to return the disputed money to the customer.

Declining trend

However, the good news is that the number of card-related complaints has gradually come down in the last three years — from about 18,810 in 2009-10.

Compared to 2010-11, those banks that have seen reduction in the number of complaints include SBI, Canara Bank, Bank of Baroda, HDFC Bank, ICICI Bank and Standard Chartered.

Overall, the maximum decline was in new private banks and foreign banks. This could be because of steps taken by the Reserve Bank in recent times to address these issues.

For example, to check unauthorised usage of cards or fraudulent withdrawals at ATMs, the RBI, from July 1, 2011, mandated all banks to send online alerts to customers irrespective of the amount involved.

Similarly, in 2011, it made PIN validation compulsory for every successive transaction at the ATM, failing which a forgotten card at the machine could easily be misused.

Besides, a second factor authentication (that is, verified by Visa/MasterCard Secure) for online card transactions was made compulsory and later extended to mail order/telephone order services in 2011-12.

Chip cards to protect from skimming/cloning are also slowly gaining popularity.

> vardhini.c@thehindu.co.in

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