Know your rights at the ATM

If your bank allows cash withdrawal, balance enquiry and payment of bills, all in one single login, then chances are high that your ATM transactions are less secure.

Rahul was in a great hurry. He woke up late and had to leave quickly to meet an important client. Plus, he had to find time to withdraw cash. He got ready in a jiffy, skipped breakfast, ran to the ATM and inserted his card.

Alas! The cash never came out. To add to his woes, he figured from the mini statement that his account was actually debited by that amount he never withdrew.

Fuming, and wondering what to do, he finally got lucky as he bumped into his banker-friend Amit, who offered to drop Rahul in his car.

Rahul: These so called technological advances. Although they are planned to save time, they have a knack of causing maximum inconvenience when we need its services the most. What do I do now?

Amit: Actually, a ‘no show' of cash is one of the most common complaints that banks receive. But didn't you look around inside the ATM centre? The Reserve Bank (RBI) mandates banks to prominently display information related to the lodging of ATM related complaints there.

A notice board saying that you can lodge a complaint at the branch where you have the account linked to the ATM card and displaying the contact numbers of the help desk should have been there.

Rahul: No. I suppose I will now have to take time off one day and go to the bank. But beyond this hassle, even if submit a written complaint, this is going to be a long ordeal.

I remember that one of my uncles who faced with a similar situation got the money back after 50 days. Poor man, he wanted to withdraw a substantial sum for an emergency need then and the bank did nothing much to help him out in the interim. He had to eventually borrow from my father.

Amit: Yes. We have had a few cases like that, too. But he is entitled to a compensation for the delay.

If he had lodged the complaint within 30 days of the transaction, the bank has to resolve it within seven days of receiving the complaint. If the bank had failed to recredit the account within seven days, he is entitled to a compensation of Rs 100 a day from the bank. Actually this seven-day limit is applicable from July 2011 onwards. It was twelve days until then.

Rahul: Tell me, how many banks really explain these things to us? This invariably brings out the need for customers to be more vigilant and aware of our rights.

But I suppose that reducing the number of days to seven is a step in the right direction. It shows that banks are getting serious about not inconveniencing the customer. Even then, why should I suffer for no fault of mine? Don't I have the right to get the wrong debit of funds immediately reversed?

Amit: The Damodaran Committee on Customer Service in Banks sorted this out in its report this year. If it is accepted, then you may well see banks offering a temporary credit of the full amount.

This, the committee has said, can be done not only for cash not delivered at ATMs but also for withdrawal through cloned cards, unauthorised credit card debits and internet banking frauds. The committee has also made it clear that in monetary disputes arising out such frauds, the onus will be on the bank to prove that the customer was wrong and not the other way round. Similar sentiments were echoed at a recent banking ombudsman conference.

The ombudsmen also agreed that the banks should have insurance in place for customer refunds in card transactions.

Rahul: Wow! Looks like there is pressure from all corners for banks to make life simpler for us. Without these customer friendly measures, imagine the running around we have to do to just get back what is rightfully ours!

Amit: True. Banks are increasingly adopting measures to safeguard customer interest. Tell me, does your bank allow you to withdraw cash, make a balance enquiry and pay bills, all in one single login?

Rahul: I think so. Once I insert the card and key-in the PIN, I do all what I want and finally log out.

Amit: If that's the case, chances that your ATM transactions are less secure are really high. Think what will happen if like today, you are in a great hurry and collect the cash but forget to collect the card back. Any Tom, Dick or Harry has free access to your account! To make it more secure, the RBI, in its ‘Master Circular on Customer Service' for 2011 has made a procedural amendment for ATM transactions.

Under this, each bank has to ensure that the process flow is modified to provide for PIN validation for every successive transaction, failing which they will attract a penalty under the Payments and Settlement Systems Act. So if your ATM card does not work this way, you have the right to ask your bank.

Rahul: I'll check this with them.

Amit: Also, considering several incidents of unauthorised usage of cards or fraudulent withdrawals at ATMs, the RBI has mandated banks to send online alerts to customers irrespective of the amount involved or the channel used from July 1, 2011. So if you have not been receiving these alerts even after you have updated your mobile number or email, you can demand this from your banker.

Rahul: Sure Amit. Thanks a lot. Now I know that I have more than one point to discuss with my branch manager when I go to register my complaint. Poor fellow.

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