A CRITICAL REVIEW OF PERFORMANCE OF BANKING OMBUDSMAN SCHEME IN INDIA

In an age of increasing competition to provide quality service to its customers, the Banking sector in India emphasizes on gratification of service and customer satisfaction. Where the customer is not happy with the services rendered by the bank, the customer shall be entitled to lodge a complaint with the grievance cell of the bank. Every year, banks get in to many lawsuits, several of which go beyond the years. This shows the incompetence of the banks' grievance resolution system in solving all customer complaints. When customers feel that Grievance Cell of the Bank is ineffective in solving the customers problem, they have the option to knock the doors of Banking Ombudsman. In 1995, India launched the Banking Ombudsman Scheme to resolve customer complaints effectively, quickly and impartially and to prevent deficiencies and delay in existing legal protection mechanisms. Although the number of complaints received over this platform has recently amplified, a major concern has been the lack of awareness among customers. With some constructive steps of RBI and the Banking Ombudsman's popularity drives, the situation now appears far better. This study is an attempt to explore the role of Banking Ombudsman in addressing grievances filed by customers of various banks. Data was obtained from RBI bulletins for the purpose of the research. The study may help to understand the Banking Ombudsman Scheme with regard to the reception and dissemination of grievances, the type and mode of grievances received, the area-wise coverage of complaints and the trend of decline of complaints.


DATA COLLECTION
The current research is focused on secondary information. Secondary data was gathered from journals, prior studies, committee reports, RBI bulletins and banking information news reports. Core information has been obtained from Annual Report of Banking Ombudsman Scheme published by RBI. The Banking Ombudsman Act 2006 with amendments is relied for reference and understanding of the scheme.

HISTORY
The complaints about banks for poor service has risen over time, while banks have made different efforts to notify the RBI. As the focus of banks has been shifted from a "class bank" to a "mass bank", Banks are under pressure to meet the diverse needs of customers. [10] These crucial areas were investigated by the Narasimham Committee on "Banking and Financial Sector Reforms" which advised the implementation of the "Banking Ombudsman Scheme 1995" as part of the 1991-92 to 1995-96 Financial Sector Policy and Framework Reforms. Recommendations are very significant and undoubtedly required as a necessity. This is appropriate in light of the changing demands of users in relation to the increasing liberalization of the financial sector and banking, as well as the increasing awareness of their rights among customers. In this context, the RBI approved the proposal and, on 14 th June 1995, as part of Banking Policy, Dr. C. Rangarajan, Governor RBI announced the Banking Ombudsman Scheme. The system was promulgated under the provisions of the Banking Regulation Act of 1949 and includes all Scheduled Commercial Banks and the Scheduled Primary Co-operative Banks operating in India. The program entered into force in June 1995. Originally, the Ombudsman was based in three centres, i.e., Mumbai, New Delhi and Bhopal, on full time basis, later it expanded its base of operations. The purpose and goal of the Ombudsman is to provide a fast and cost-effective way to address customer complaints resulting from poor banking services. Therefore, the Ombudsman's Office is in charge of dealing with public complaints against deficiencies in banking services related to the functioning of deposit accounts and loans and advances. Paradigm change from the Banking Ombudsman Scheme 1995 to the Banking Ombudsman Scheme 2006 have been made to expand the reach and scope of the bank ombudsman to previously discovered sectors.
[11] The Ombudsman is a quasi-judicial authority operating under the Indian Banking Ombudsman Scheme. The agency was constituted as a result of the Indian government's decision to facilitate the resolution of complaints from banking clients about certain services provided by banks. [12]

JURISDICTION OF BANKING OMBUDSMAN
The Banking Ombudsman Scheme 2006 applies to entire India and covers all Scheduled Commercial Banks, Regional Rural Banks and Scheduled Primary Co-operative Banks. [13] The location of the office will be determined by the RBI. However, in order to resolve the issue quickly, a banking ombudsman may function in the appropriate places within his jurisdiction that he considers necessary. [13] There are twenty-two offices of the Banking Ombudsman with particular provincial Although non-compliance with the Code of Practice continued to be a major reason for complaints, there is a decreasing trend in the past three years under this head. Complaints relating to pension, levy of charges without notice, and remittance also showed a decreasing trend in the review period. However, the number of grievances related to mis-selling went up from 579 in 2017-18 to 1,115 in 2018-19, an alarming rise of 92.57%. ATM/ Debit Card complaints accounted for 18.65% of all complaints, up from 15.08% in 2017-18. A notable sub-category of the total number of ATM / Debit Card complaints was "Account debited but cash not dispensed by ATMs," which reported for approximately 53% [17] It represents the cyber security issues connected with digital banking which required to be addressed by RBI. The complaints out of purview of the Act also decreased indicating that there is more awareness and understanding of the scheme.  (33,690), which was 17.20% of the total complaints lodged with the Banking Ombudsman. The total number of complaints received by OBO in New Delhi is 44,932 cases, which is 22.94 percent of all complaints recorded during 2018-19. This reflects the regional imbalance among metro cities in the filing of complaints. The Scheme promotes the resolution of complaints through negotiation and settlement by BOS. The BO will make a judgment or authorize an award if the parties do not reach an appropriate agreement. In the past two years, the number of complaints resolved through settlement has increased significantly. As shown in the

DISCUSSION
The Banking Ombudsman's annual performance reports on the Banking Ombudsman Scheme is issued by the RBI and performance is measured against such aspects as the number of complaints they have processed, the ability to manage the problem, and the effectiveness of the decisions of Banking Ombudsman. This review is based on the most recent data available. [6] It is also noticed in the Banking Ombudsman Report for the year 2018-19 that because of their larger base, the number of complaints received by public sector banks is higher, but the figure referring to complaints per branch depicts the true picture as it places each bank in the same place. And against private-sector banks, the figure is highly negative. According to the Banking from all nationalised banks reached 61,755, when a total of 54,922 complaints were received by private sector banks. After SBI, the Punjab National Bank ranked second among the public sector banks and received 10,791 complaints, followed by the Bank of Baroda with 9,385. HDFC Bank received the highest complaints among the private sector banks (15,105), followed by ICICI bank (11,257) and Axis bank (10,010).
[17] The number of complaints received from the Nationalized Banks is maximum, whereas the number of complaints received from the Private Sector Banks, Foreign Banks and RRBs and Urban Cooperative Banks is minimal during the last 3 financial years. The main reason may be that the nationalized banks and SBI group of banks are having the highest customer-base and the same is increasing day-by-day. Apart from the reason that there are more customers for public sector banks even the staffs of public sector banks are not as efficient and customer friendly as staff in private and other banks.
In the report the zone-wise receipt of complaints it can be deduced that the maximum growth in the number of complaints on an annual basis was greater in the northern area (23.41%), followed by the southern area (18.65%), in the western area (17.91 %) and the eastern zone (13.19% 9.0 CONCLUSION The bank's success depends primarily on its customers. As a service sector, all banks should strive to meet customer needs by providing maximum functionality for their services, including grievance redressal services. Banks must provide their customers with an effective grievance redressal system and continuously monitor the level of customer satisfaction. [24] Since banks are financial institutions in all parts of the world, the resolution of complaints about their conduct is also an essential characteristic of customer satisfaction. Therefore, the authority in several countries has appointed the Banking Ombudsman for the addressing of customer complaints related to banking transactions. [25] There is no doubt that Banking Ombudsman Scheme is beneficial for bank customers, as we can see on an average more than 94% of the cases are settled annually by Ombudsmen in India. A very low level of pending cases represents the efficiency of the Indian complaint grievance redressal system followed under BO Scheme regulated by RBI. However, the increase in number of complaints in the past two years are insignificant. Therefore, it is imperative that some measures shall be adopted by the Banks and RBI to popularise Banking Ombudsman Scheme among all customers. [19] 10.0 ACKNOWLEDGEMENT I would like to express my gratitude to my guide Dr. Narayana Kayarkatte for the useful comments, feedback and commitment through the learning process of my research. I thank my beloved ones who provided their encouragement and guidelines.