CONSUMER PROTECTION: A GUIDE TO FILE A CONSUMER COMPLAINT OR CASE WITHOUT STEPPING OUT OF OUR HOUSE - Business Guardian
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CONSUMER PROTECTION: A GUIDE TO FILE A CONSUMER COMPLAINT OR CASE WITHOUT STEPPING OUT OF OUR HOUSE

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Raise retirement age of SC, HC judges: BCI

INTRODUCTION

In ancient time, there was the system called “Barter System” which was used for purchasing and selling the goods and services. Now the question is what is barter system? Barter system refers to the method where the sale and purchase of goods takes place without involving of money or when the buyer and seller look for each other who can purchase his goods or services and give him the required goods and services in return. At that time a consumer was defined as a person who wants to buy a good but in exchange of the product he is having and the demand of the consumer was very specific and to the point. With the changing time, increasing competition and migration of people to metropolitan cities the demands and wants of the people have changed. And also the term consumer has evolved completely and now a consumer is defined as a person who can buy either good or service just paying the worth of it and the consumer of present time has huge demands and choices to choose from in each field whether it may be apparels, food, accessories, footwear, etc. For example if a person wants to buy a jeans he has infinite brands choose from like Zara, Levis, Wrangler, Being Human, UCB, True Religion, etc. This unlimited choice of brands and huge varieties available makes the consumer a king of the market as he doesn’t have to depend on someone who will buy his goods and fulfill the requirement. In other words we can say that consumer is the king of the market as he brings the business to the sellers. And now-a-days, trend of online shopping has been increased, more and more sellers are entering in the market with the aim to earn more profits. For this purpose, they do use unfair means like adulteration, selling defective products, duplicate products, selling products which are either banned or are injurious to health, etc. to cheat the consumers and earn huge profits. During ancient times it was often said that “buyers beware” but now it said that “let the sellers beware” because the policies of the government has became stringent, laws are being made implemented in more an effective manner, necessary amendments are done from time to time in the laws, initiatives like Jago Grahak Jago are in action, NGO or groups of volunteers are working very hard to stop such malpractices, etc.

NEED FOR CONSUMER PROTECTION

There is a strict need for consumer protection these days as we know a lot of malpractices are being done by the sellers to cheat the buyers and earn huge profits. When we talk about malpractices, they either directly or indirectly affect the consumer seller relations, for example, if a consumer visits a supermarket (where the store changes the expiry date of the expired products and shows them fresh to avoid losses) and purchases a frozen food item and on consumption of the same, he falls sick and suffers from food poisoning, the consumer will for sure won’t go to that particular store as he is now aware that they do such malpractices and it also spoils the reputation of the store that to earn a bit more they change the date of the expired products and sell, this is just one instance but if we look around we will observe thousands of such instances where such things are happening and no one is aware. Moreover, consumer protection is important because it involves various factors which are related to customers such as price paid by him, health, shopping confidence, etc. In other words, we can say that consumer protection is important as consumers’ interests need to be safeguarded. They are informed and ununited individuals who are often exploited by sellers. They need to be protected from the unjust and unethical practices of the producers and traders. In order to safeguard the interest of the consumers the Government of India has launched two various portals i.e. NCH and e-Daakhil where a consumer without stepping out of his/her home can lodge a complaint or can file a case against the wrong, and the same that how a case or compliant is to be filed is explained further.

WHAT IS NCH/INGRAM PORTAL?

The term NCH stands for National Consumer Helpline. It is basically a project started by the Union Ministry of Consumer Affairs which operates under Centre for Consumer Studies at Indian Institute of Public Administration. It is the helpline to resolve the queries or questions of the consumers and also to hear the problems being faced by the consumers caused due to businesses or service providers. Now the question arises how to file a complaint using this portal? The answer to this question is very simple, there are basically two methods for reporting a wrong/filing a case accessing this portal. The first method is online and the second method is by calling.

WHAT IS E-DAAKHIL?

E-daakhil is a consumer commission online-application portal, or in simple words we can say that it is an application for e-filing of consumer complaints. The platform can be accessed by visiting https://edaakhil.nic.in/edaakhil/ and by using this platform the complainant can himself file a case, or advocates can also use this platform to file the cases. According to a report, e-daakhil portal for online filing of consumer complaints is now functional across 15 states and UTs namely Delhi, Maharashtra, Andaman & Nicobar Islands, Bihar, Chhattisgarh, Jharkhand, Gujarat, Chandigarh, Andhra Pradesh, Odisha, Uttar Pradesh, Madhya Pradesh, Punjab, Karnataka and Haryana.

HOW TO USE NCH/INGRAM PORTAL?

The steps for lodging a complaint using both the methods i.e. either online or by calling are mentioned as below:

For Registering Grievance Online

Step 1: The consumer has to visit the website of NCH i.e. https://consumerhelpline.gov.in/nch.php to register his grievance in online mode.

Step 2: After visiting the website, he have to create his account which usually takes 2-3 minutes. While creating he have to mention his Name, Email ID, Mobile Number, Gender and to keep a password, using which he can access his account anytime.

Step 3: Once the he have created he is account, he will automatically be redirected to the Dashboard, and on the left hand, he will two other options as well, namely, Register Grievance, and Grievance History.

Step 4: Following to Step 3, he has to click on Register Grievance, and subsequently the screen showing Grievance Registration Form will appear where he will have to fill details of the grievance such as type, purchase state and city, industry, category, brand, description of the wrong, etc. He can also attach upto 3 attachments such as any picture of the product or invoice, etc.

Step 5: Once he has filled the form, he simply have to click on ‘SUBMIT’ and his grievance will be registered and he will be conveyed his complaint number on his registered email and mobile number.

Step 6: Soon, the NCH agent will look at his complaint and mention will mention the action that he needs to take. He can also visit the Grievance History section to check the status of his case or list of cases he filed previously.

Step 7: He before disposition of the case can also call the NCH to know the update or mention any reply received from the defendant i.e. brand. Once, the case is closed or disposed he will get a call from the team NCH, to record his feedback.

For Registering Grievance through Calling

Step 1: The consumer can register his grievance by making a call either on 1800114000 or 14404. He can call anytime between 09:30 AM to 5:30 AM, all days except national holidays.

Step 2: After calling he has to select the preferred language of his choice and the select the options relevant from the IVR menu and he will be connected with the NCH agent.

Step 3: Once the he is connected with the agent, he has to mention his Name, Email ID, Mobile Number and other details as asked by the agent. He will automatically create his account on the NCH portal, which he can access by visiting their website.

Step 4: After mentioning the details, he can tell whatever query he is having or can mention the details of the grievance to the NCH agent and he will record the same, and will guide him accordingly by telling him the next step that he has to take.

Step 5: Once he his call ended, he will immediately receive his grievance complaint number on his registered email and mobile number. He can also visit the website of the NCH and from the Grievance History section he can check the status of his case. He can also update the invoice or relevant pictures while checking the status.

Step 7: He before disposition of the case can also call the NCH to know the update or mention any reply received from the defendant i.e. brand. Once, the case is closed or disposed he will get a call from the team NCH, to record his feedback.

HOW TO USE IT

E-DAAKHIL?

The steps for filing an online complaint are as follows:

Step 1: The person (it can either be the complainant or an advocate) has to visit the website of e-daakhil which is https://edaakhil.nic.in/edaakhil/, to make an online complaint. It is mandatory for the user to get him registered on the portal.

Step 2: To get the user registered, he has to select the option of “registration” from the landing page and he will be re-directed to the registration page and there he will have to fill some basic details like name, father’s name, address, email id, date of birth etc. and will have to set a login password. The user will also have to upload the copy of his identity proof and prior filling the details, he will submit the form and will get an OTP on his registered number to complete the verification process. [This step is for NEW USERS only]

Step 3: After completing the registration process, the user can access his account by logging in his account from the landing page. Once he is logged in into his account he will see an option on the top to “file a new case”, he will select it and proceed further.

Step 4: Later he will be landed on a page where he firstly have to fill the amount to be claimed and place of cause of action, after submitting it, the page will move to case details where the details like name, email id, mobile number, complete address of both the parties i.e. of the complainant and the opposite party are to be filled. Also on same page the details of the advocate of the complainant and the case summary is mandatorily to be filled and submitted.

Step 5: After submitting the case details, the details of the additional complainant are to be filled, it is applicable only when more than one person is filing the case. Once the details of the additional complainant is submitted the page will move to the details of the additional opposite party, it is applicable when the claim is to be done from more than one party.

Step 6: Once all the details are filled and duly submitted the page will move to the tab of “document upload” where documents like index; list of dates and events; memo of parties (with complete address); complaint with affidavit are to be uploaded.

Step 7: After uploading of the documents, the screen to finalize and submit the application appears, where we can preview the entire application and documents arranged in the sequence and check for mistakes, if any. Also on this window, the user has to choose the commission that where he has to file the case from the available options.

Step 8: After verifying all the details and selecting the commission where the user has to file the case, he has to select all the checkboxes confirming that he cross-checked everything and then finally he has to click on “finalize” button. On the next screen an OTP will be sent on his mobile number for verification and safety purposes and after OTP verification, the screen will be redirected to pending cases window.

Step 9: From the pending cases window, the user has to choose the case and make the payment of fees and then the complaint will be transferred to the selected commission. The payment can be done in online mode using Debit/Credit Card, Internet Banking, IMPS, etc. as well as in offline mode by Bank DD/IPO/Challan/NEFT/RTGS. From the available modes, the user has to choose the mode of his convenience.

Step 10: Once the payment is done successfully, the case will be sent to the commission for the approval and once it is approved, it will be moved to the tab of pending approved cases. The user can also check the status of his from the main landing page by entering the case reference number and other required details, under the tab of “check case status”.

The e-daakhil portal enables the consumers (complainants) and advocates by facilitating them the service of online filing of consumer cases across the country and for the redressal of their complaints. The e-daakhil also provides consumers the services like case document download, link for virtual hearing, filing written response by opposite party, filing rejoinder, filing first appeal, filing for revision petition, etc. It also provides alerts via SMS/e-mail for the ease of the consumers. In India, most of the population resides in the rural areas and are illiterate, many of also don’t have access to electronic modes of communication or unable to use the tools. So, it has been decided by the authorities to link the service of online filing provided by e-daakhil with CSCs (Common Service Centres) for the ease of the people who cannot use electronic device.

CONCLUSION

Most of the people in our country have that mentality that the cheating is done with the X person and we have no concern with him, so why to worry! and some people think that why to waste time the in filing the cases and complaints for a small amount, let it be! These are the only people who encourages that sellers doing cheating that you guys do anything we will not take any action, and when someday they become the victim of some big fraud, they cry and think what to do. The people should think that if they will stop the crime at stage one only then it will not tend to rise to stage six. The government is doing its best, to eradicate such practices from the economy and this is the only reason that for the repulsion of the Consumer Protection Act 1986 and the introduction of the Consumer Protection Act 2019 because with the changing time, the ways to do commits frauds has also changed, a layman example for it could be, in olden times the sellers used to cheat the consumers by adulteration (mixing good quality goods and bad quality goods) whereas in current time, the sellers used change the full product only like delivering soaps in the box of an Apple’s iPhone. For the consumers who feel that they are harassed at courts, the government has eased the system by providing e-filing facility which is very convenient, easy to use and time saving. Now it is the duty of the consumers in the society to report such cases by filing complaints and stand for justice. We should always remember that, “A market without consumers will be a night sky without the stars and moon. Protect their rights and serve them the best for greater reputation and fame.”

The e-daakhil portal enables the consumers (complainants) and advocates by facilitating them the service of online filing of consumer cases across the country and for the redressal of their complaints. The e-daakhil also provides consumers the services like case document download, link for virtual hearing, filing written response by opposite party, filing rejoinder, filing first appeal, filing for revision petition, etc. It also provides alerts via SMS/e-mail for the ease of the consumers.

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Policy&Politics

Govt extends date for submission of R&D proposals

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The Government has extended the deadline for submission of proposals related to R&D scheme under the National Green Hydrogen Mission. The R&D scheme seeks to make the production, storage, transportation and utilisation of green hydrogen more affordable. It also aims to improve the efficiency, safety and reliability of the relevant processes and technologies involved in the green hydrogen value chain. Subsequent to the issue of the guidelines, the Ministry of New & Renewable Energy issued a call for proposals on 16 March, 2024.

While the Call for Proposals is receiving encouraging response, some stakeholders have requested more time for submission of R&D proposals. In view of such requests and to allow sufficient time to the institutions for submitting good-quality proposals, the Ministry has extended the deadline for submission of proposals to 27th April, 2024.

The scheme also aims to foster partnerships among industry, academia and government in order to establish an innovation ecosystem for green hydrogen technologies. The scheme will also help the scaling up and commercialisation of green hydrogen technologies by providing the necessary policy and regulatory support.

The R&D scheme will be implemented with a total budgetary outlay of Rs 400 crore till the financial year 2025-26. The support under the R&D programme includes all components of the green hydrogen value chain, namely, production, storage, compression, transportation, and utilisation.

The R&D projects supported under the mission will be goal-oriented, time bound, and suitable to be scaled up. In addition to industrial and institutional research, innovative MSMEs and start-ups working on indigenous technology development will also be encouraged under the Scheme.

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Policy&Politics

India, Brazil, South Africa to press for labour & social issues, sustainability

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The Indian delegation also comprises Rupesh Kumar Thakur, Joint Secretary, and Rakesh Gaur, Deputy Director from the Ministry of Labour & Employment.

India, on Thursday, joined the G20’s two-day 2nd Employment Working Group (EWG) meeting under the Brazilian Presidency which is all set to address labour, employment and social issues for strong, sustainable, balanced and job-rich growth for all. India is co-chairing the 2nd EWG meeting, along with Brazil and South Africa, and is represented by Sumita Dawra, Secretary, Labour & Employment.

The Indian delegation also comprises Rupesh Kumar Thakur, Joint Secretary, and Rakesh Gaur, Deputy Director from the Ministry of Labour & Employment. India has pointed out that the priority areas of the 2nd EWG at Brasilia align with the priority areas and outcomes of previous G20 presidencies including Indian presidency, and commended the continuity in the multi-year agenda to create lasting positive change in the world of work. This not only sustains but also elevates the work initiated by the EWG during the Indian Presidency.

The focus areas for the 2nd EWG meeting are — creating quality employment and promoting decent labour, addressing a just transition amidst digital and energy transformations, leveraging technologies to enhance the quality of life for al and the emphasis on gender equity and promoting diversity in the world of employment for inclusivity, driving innovation and growth. On the first day of the meeting, deliberations were held on the over-arching theme of promotion of gender equality and promoting diversity in the workplace.

The Indian delegation emphasized the need for creating inclusive environments by ensuring equal representation and empowerment for all, irrespective of race, gender, ethnicity, or socio-economic background. To increase female labour force participation, India has enacted occupational safety health and working conditions code, 2020 which entitles women to be employed in all establishments for all types of work with their consent at night time. This provision has already been implemented in underground mines.

In 2017, the Government amended the Maternity Benefit Act of 1961, which increased the ‘maternity leave with pay protection’ from 12 weeks to 26 weeks for all women working in establishments employing 10 or more workers. This is expected to reduce the motherhood pay gap among the working mothers. To aid migrant workers, India’s innovative policy ‘One Nation, One Ration Card’ allows migrants to access their entitled food grains from anywhere in the Public Distribution System network in the country.

A landmark step in fostering inclusion in the workforce is the e-Shram portal, launched to create a national database of unorganized workers, especially migrant and construction workers. This initiative, providing the e-Shram card, enables access to benefits under various social security schemes.

The portal allows an unorganized worker to register himself or herself on the portal on self-declaration basis, under 400 occupations in 30 broad occupation sectors. More than 290 million unorganized workers have been registered on this portal so far.

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Policy&Politics

India to spend USD 3.7 billion to fence Myanmar border

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India plans to spend nearly $3.7 billion to fence its 1,610-km (1,000-mile) porous border with Myanmar within about a decade, said a source with direct knowledge of the matter, to prevent smuggling and other illegal activities. New Delhi said earlier this year it would fence the border and end a decades-old visa-free movement policy with coup-hit Myanmar for border citizens for reasons of national security and to maintain the demographic structure of its northeastern region.

A government committee earlier this month approved the cost for the fencing, which needs to be approved by Prime Minister Narendra Modi’s cabinet, said the source who declined to be named as they were not authorised to talk to the media. The prime minister’s office and the ministries of home, finance, foreign affairs and information and broadcasting did not immediately respond to an email seeking comment.

Myanmar has so far not commented on India’s fencing plans. Since a military coup in Myanmar in 2021, thousands of civilians and hundreds of troops have fled from there to Indian states where people on both sides share ethnic and familial ties. This has worried New Delhi because of risk of communal tensions spreading to India. Some members of the Indian government have also blamed the porous border for abetting the tense situation in the restive north-eastern Indian state of Manipur, abutting Myanmar.

For nearly a year, Manipur has been engulfed by a civil war-like situation between two ethnic groups, one of which shares lineage with Myanmar’s Chin tribe. The committee of senior Indian officials also agreed to build parallel roads along the fence and 1,700 km (1,050 miles) of feeder roads connecting military bases to the border, the source said.

The fence and the adjoining road will cost nearly 125 million rupees per km, more than double that of the 55 million per km cost for the border fence with Bangladesh built in 2020, the source said, because of the difficult hilly terrain and the use of technology to prevent intrusion and corrosion.

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Policy&Politics

ONLY 2-3% RECOVERED FROM $2-3 TN ANNUAL ILLEGAL TRADE THROUGH BANKING: INTERPOL

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However, Stock highlighted the enormity of the challenge, noting that between 40% and 70% of criminal profits are reinvested, perpetuating the cycle of illicit financial activity.

In a press briefing held on Wednesday, Interpol Secretary General Jurgen Stock unveiled alarming statistics regarding the extent of undetected money laundering and illegal trade transactions plaguing the global banking network. Stock revealed that over 96% of the money transacted through this network remains undetected, with only 2-3% of the estimated USD 2-3 trillion from illegal trade being tracked and returned to victims.

Interpol, working in conjunction with law enforcement agencies and private financial sectors across its 196 member countries, is committed to combating the rising tide of fraud perpetrated by illicit traders. These criminal activities encompass a wide spectrum, including drug trafficking, human trafficking, arms dealing, and the illicit movement of financial assets.

Stock emphasized the urgent need to establish mechanisms for monitoring transactions within the global banking network. Currently, efforts are underway to engage banking associations worldwide in setting up such a framework. However, Stock highlighted the enormity of the challenge, noting that between 40% and 70% of criminal profits are reinvested, perpetuating the cycle of illicit financial activity. The lack of real-time information sharing poses a significant obstacle to law enforcement agencies in their efforts to combat money laundering and illegal trade.

Stock underscored the role of Artificial Intelligence (AI) in exacerbating this problem, citing its use in voice cloning and other fraudulent activities. Criminal organizations are leveraging AI technologies to expand their operations and evade detection on a global scale. Stock emphasized the importance of enhanced cooperation between law enforcement agencies and private sector banking groups. Realtime information sharing is crucial in the fight against illegal wealth accumulation.

Drawing inspiration from initiatives such as the “Singapore Anti-Scam Centre,” Stock called for the adoption of similar models in other countries to strengthen the collective response to financial crimes. In conclusion, Stock’s revelations underscore the pressing need for concerted action to combat global financial crimes. Enhanced cooperation between public and private sectors, coupled with innovative strategies for monitoring and combating illicit transactions, is essential to safeguarding the integrity of the global financial system.

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Policy&Politics

FM defends Atal Pension Scheme, highlights guaranteed returns

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Finance Minister Nirmala Sitharaman defended the Atal Pension Yojana (APY) against Congress criticism, asserting its design based on choice architecture and a guaranteed minimum 8% return. She emphasized the scheme’s opt-out feature, facilitating automatic premium continuation unless subscribers choose otherwise, promoting retirement savings. Sitharaman countered Congress allegations of coercion, stating the APY’s guaranteed returns irrespective of market conditions, supplemented by government subsidies.

Responding to Congress’s claim of scheme misuse, Sitharaman highlighted its intended beneficiaries – the lower-income groups. She criticized Congress for its alleged elitist mindset and emphasized the scheme’s success in targeting the needy. Sitharaman accused Congress of exploiting vote bank politics and coercive tactics, contrasting it with the APY’s transparent framework. The exchange underscores the political debate surrounding social welfare schemes, with the government defending its approach while opposition parties raise concerns about implementation and efficacy.

Finance Minister Nirmala Sitharaman’s robust defense of the Atal Pension Yojana (APY) against Congress criticism highlights the ongoing debate over social welfare schemes in India. Sitharaman’s assertion of the APY’s design principles, including its opt-out feature and guaranteed minimum return, underscores the government’s commitment to promoting retirement savings among lower-income groups. The Atal Pension Yojana, named after former Prime Minister Atal Bihari Vajpayee, was launched in 2015 to provide pension benefits to workers in the unorganized sector. It aims to address the significant gap in pension coverage among India’s workforce, particularly those employed in informal and low-income sectors. The scheme offers subscribers fixed pension amounts ranging from Rs. 1,000 to Rs. 5,000 per month, depending on their contribution and age at entry, after attaining the age of 60. Sitharaman’s response comes after Congress criticism alleging the APY’s inefficacy and coercive tactics in enrolment.

Congress General Secretary Jairam Ramesh described the scheme as poorly designed, citing instances of subscribers dropping out due to unauthorized account openings. However, Sitharaman refuted these claims, emphasizing the APY’s transparent and beneficiary-oriented approach. The finance minister’s defense focuses on three key aspects of the APY: Choice Architecture: Sitharaman highlights the opt-out feature of the APY, which automatically continues premium payments unless subscribers choose to discontinue.

This design element aims to encourage long-term participation and ensure consistent retirement savings among subscribers. By simplifying the decision-making process, the scheme seeks to overcome inertia and promote financial discipline among participants. Guaranteed Minimum Return: Sitharaman underscores the APY’s guarantee of a minimum 8% return, irrespective of prevailing interest rates. This assurance provides subscribers with confidence in the scheme’s financial viability and incentivizes long-term savings.

The government’s commitment to subsidizing any shortfall in actual returns further strengthens the attractiveness of the APY as a retirement planning tool. Targeting the Needy: Sitharaman defends the predominance of pension accounts in lower income slabs, arguing that it reflects the scheme’s successful targeting of its intended beneficiaries – the poor and lower-middle class. She criticizes Congress for its alleged elitist mindset and suggests that the party’s opposition to welfare schemes like the APY stems from a disconnect with the needs of marginalized communities. Sitharaman’s rebuttal also addresses broader political narratives surrounding social welfare policies in India.

She accuses Congress of exploiting vote bank politics and coercive tactics, contrasting it with the transparent and inclusive framework of the APY. The exchange underscores the ideological differences between the ruling Bharatiya Janata Party (BJP) and the opposition Congress, with each side advocating for their vision of social welfare and economic development. In addition to defending the APY, Sitharaman’s remarks shed light on the broader challenges and opportunities facing India’s pension sector.

Despite significant progress in expanding pension coverage through schemes like the APY, the country still grapples with issues such as financial literacy, informal employment, and pension portability. Addressing these challenges requires a multifaceted approach involving government intervention, private sector participation, and civil society engagement.

As India strives to achieve its vision of inclusive and sustainable development, initiatives like the APY play a crucial role in promoting economic security and social equity. Sitharaman’s defense of the scheme underscores the government’s commitment to addressing the needs of vulnerable populations and ensuring their financial well-being in the long run.

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Economic

Regulatory steps will make financial sector strong, but raise cost of capital

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India’s financial system regulator, the Reserve Bank of India (RBI), is demonstrating a serious commitment to improving governance and transparency at finance companies and banks, with the RBI’s recent measures aimed at curtailing lenders’ overexuberance, enhancing compliance culture and safeguarding customers.

While the global ratings firm has appreciated the RBI’s “diminishing tolerance for non-compliance, customer complaints, data privacy, governance, know-your-customer (KYC), and anti-money laundering issues”, it has cautioned that increased regulatory risk could impede growth and raise the cost of capital for financial institutions. “Governance and transparency are key weaknesses for the Indian financial sector and weigh on our analysis. The RBI’s new measures are creating a more robust and transparent financial system,” says S&P Global Credit Analyst, Geeta Chugh. “India’s regulator has underscored its commitment to strengthening the financial sector. The drawback will be higher capital costs for institutions,” Chugh cautions.

The RBI measures include restraining IIFL Finance and JM Financial Products from disbursing gold loan and loans against shares respectively and asking Paytm Payments Bank (PPBL) to stop onboarding of new customers. Earlier in December 2020, the RBI suspended HDFC Bank from sourcing new credit card customers after repeated technological outages. These actions are a departure from the historically nominal financial penalties imposed for breaches, S&P Global notes.

Besides, as the global agency points out, the RBI has decided to publicly disclose the key issues that lead to suspensions or other strict actions against concerned entities and become more vocal in calling out conduct that it deems detrimental to the interests of customers and investors. “We believe that increased transparency will create additional pressure on the entire financial sector to enhance compliance and governance practices,” adds Chugh. The global agency has also lauded the RBI’s recent actions demonstrating scant tolerance for any potential window-dressing of accounts.

These actions include the provisioning requirement on alternative investment funds that lend to the same borrower as the bank finance company. Amidst the possibility of some retail loans, such as personal loans, loans against property, and gold loans getting diverted to invest in stock markets and difficulty of ascertaining the end-use of money in these products, S&P Global underlines the faith of market participants that the RBI and market regulator, the Securities and Exchange Board of India, want to protect small investors by scrutinizing these activities more cautiously.

On the flip side, at a time of tight liquidity, the RBI’s new measures are likely to limit credit growth in fiscal 2025 (year ending March 2025). “We expect loan growth to decline to 14 per cent in fiscal 2025 from 16 per cent in fiscal 2024, reflecting the cumulative impact of all these actions,” says Chugh. The other side of the story is that stricter rules may disrupt affected entities and increase caution among fintechs and other regulated entities and the RBI’s decision to raise risk weights on unsecured personal loans and credit cards may constrain growth. Household debt to GDP in India (excluding agriculture and small and midsize enterprises) increased to an estimated 24 per cent in March 2024 from 19 per cent in March 2019. Growth in unsecured loans has also been excessive and now forms close to 10 per cent of total banking sector loans.

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