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Saturday, May 28, 2011

Banks will have to resolve ATM complaints within seven days

MUMBAI: The Reserve Bank of India (RBI) has reduced the time that banks take to resolve customers' complaints regarding ATM transactions to seven working days from 12 working days.

Banks, which fail to resolve complaints within seven working days, will have to pay customers 100 per day as compensation.

The new guideline will be effective from July 1 this year. The move to resolve the dispute has come as a major relief to millions of customers who are increasingly using ATMs to withdraw cash.

While issuing this directive, RBI has also said customers have to lodge a complaint to the issuing bank within 30 days of the date of transaction to be entitled to receive such a compensation for delay in resolving it.

Also, the central bank has clarified that the number of free transactions permitted per month at other bank ATMs to the savings bank account holder will be inclusive of all types of transactions - financial or non-financial.

All disputes regarding failed ATM transactions have to be settled by the issuing and the acquiring bank through the ATM system provider.

RBI has first issued a circular in October 2008, asking banks to resolve the dispute within 12 working days.

Subsequently, in July 2009, it asked banks to compensate customers if the issue is not resolved within 12 working days.

While issuing these directives, the central bank had said it has received several complaints from customers regarding debit of accounts even though ATMs have not disbursed cash for various reasons.

More importantly, banks take considerable time in reimbursing the amounts to card holders involved in such failed transactions.

In many cases, the time taken is as much as 50 days. RBI directed banks to compensate customers as it felt the delay of this magnitude is not justified, as it results in customers being out of funds for a long time for no fault of theirs.

Also, the delay can discourage customers from using ATMs.

Source: EconomicTimes


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