In 2023 complaints against Govt Banks (SBI, PNB) decreased but increased for Private Banks

Annual complaints to the RBI ombudsman have displayed a declining trend, reducing from a peak of 2.36 lakh in FY21 to 1.96 lakh in FY23, marking a 12.7% decrease. Public sector banks witnessed a decline, while private sector banks saw an increase.

Breakdown by Banking Sector

• Public Sector Banks
  Complaints against public sector banks decreased by 10% from 1.13 lakh in 2021-22 to 1.02 lakh in 2022-23, as per the RBI’s ‘Report on Trend and Progress of Banking in India.’
• Private Sector Banks
  Private sector banks experienced a 7% growth in complaints, rising from 68,981 in 2021-22 to 73,764 in 2022-23.

Ombudsman Scheme and Customer Service

Under the RBI’s Integrated Ombudsman Scheme, the centralised reference point facilitates grievance registration for regulated entities. Chief Economist Madan Sabnavis attributes the decline in complaints to the effective functioning of customer service departments in banks.

Foreign and Small Finance Banks

• Foreign banks saw a 58% growth in complaints, and small finance banks experienced a 72% increase in FY23.

Complaints by Top Banks

State Bank of India, ICICI Bank Limited, and HDFC Bank Limited top the list with 40,345, 16,602, and 14,979 complaints, respectively. Complaints against SBI decreased by 13%, while ICICI and HDFC saw a 4% and 2% increase.

Potential Factors Contributing to Complaints

Madan Sabnavis suggests that private sector banks outsourcing staff may lead to lower service quality, potentially contributing to higher complaint numbers.

Category-wise Breakup of Complaints

• ATM/Debit Card/Credit Card
  Complaints in this category increased from 36,250 in 2017-18 to 1 lakh in 2020-21, gradually decreasing to 53,184 in 2022-23.
• Loans and Advances
  Complaints in this category rose from 4,926 in 2017-18 to 39,579 in 2022-23.
• Deposit Account
  Complaints related to deposit accounts increased from 6,287 in 2017-18 to 33,612 in 2022-23.
• Mobile Banking/Electronic Banking
  The number of complaints in this category is steadily growing each year.