Last Tuesday, the Reserve Bank of India announced that customers would be able to migrate their bank accounts to other banks in coming days, if banks misuse their autonomy and deny services to customers.
The central bank notified banks not to misuse the independence granted to them by fixing higher monthly average balance, denying services to common people and charging for premium services offered to customers. The central bank came up with this decision to help common people experience banking services smoothly as well as boost the competition among banks.
Commenting on the autonomy granted to banks, SS Mundra, the Deputy Governor of the Reserve Bank of India, said, “While banks have been granted autonomy…it should not be used as an excuse to deny service or to drive away common man.” According to him, the advent of high-end technology has made things like aadhaar linkage to individual bank accounts and unified payments interface (UPI) possible. It will also facilitate the process of transferring bank accounts for customers without changing their existing account numbers.
Mundra suggested the idea of bank account number portability earlier in February, 2016 while delivering his keynote address at Mint’s Annual Banking Conclave.
Referring to some of the past instances when banks charged higher service charges and increased the monthly average balance requirement, the Deputy Governor said, “As such, the prospect of an aggrieved customer silently moving her account to another bank in the near future has become very real.”