More Stories

Informist, Monday, Jul. 20, 2026

 

MUMBAI – Reserve Bank of India Deputy Governor Swaminathan J. called on banks, non-banking financial companies and other regulated entities to treat customer grievance redressal as a core business function rather than a compliance requirement, stressing that the effectiveness of the Internal Ombudsman framework should be measured by the fairness and quality of complaint resolution rather than the number of cases disposed of. 

 

Addressing an Internal Ombudsman Conference organised by the RBI in Mumbai on Jul. 13, Swaminathan said unresolved customer complaints impose costs not only in financial terms but also by eroding customer confidence, damaging institutional reputation and inviting greater regulatory scrutiny. He said the ideal grievance redressal system should resolve complaints at the earliest opportunity within the institution itself.

 

The deputy governor said the Internal Ombudsman mechanism gives financial institutions an opportunity to correct mistakes internally before complaints escalate to the RBI Ombudsman or other forums. The success of the framework, he said, should be judged by the number of complaints resolved fairly without external intervention, the number of disputes prevented from escalating and the systemic improvements resulting from the ombudsman's observations.

 

Swaminathan underlined that independence was the defining characteristic of an Internal Ombudsman and cautioned against treating the position as another layer in an institution's approval process. He said ombudsmen must assess not only whether procedures were followed but also whether customers were treated fairly, whether outcomes were reasonable and whether decisions would stand up to an objective review.

 

The deputy governor said boards and senior management must view complaint data as valuable business intelligence rather than mere compliance statistics. Rising complaints in a product, geography or delivery channel can serve as early warning signals requiring management attention, he said. 

 

Swaminathan also expressed concern that a significant proportion of complaints ultimately decided in customers' favour by the RBI Ombudsman had not been referred to Internal Ombudsmen in the first place. He urged regulated entities to review their grievance redressal systems to ensure that all eligible complaints are referred promptly and do not bypass the Internal Ombudsman because of classification or process deficiencies.  End

 

Reported by Kabir Sharma

Edited by Akul Nishant Akhoury

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (22) 6985-4000 

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2026. All rights reserved.