Complaints against banks double in 4 years: SBP

KARACHI : The State Bank of Pakistan (SBP) on Thursday said that complaints against banks have doubled in four years. The SBP said that the complaints against banks during the past four years have increased from 774,656 in 2016 to 1,549,837 in 2019. State Bank of Pakistan (SBP) has conducted a four year (2016-2019) review of complaints against Banks/MFBs/DFIs. The objective of the review was to gain insights on effectiveness of complaint management at banks. The salient features of the review are being published to emphasize SBP’s narrative that responsible complaint handling is the core element of Fair Treatment of Consumer (FTC). This review is conducted in addition to various regulatory measures to enhance consumer grievance handling in the industry including the issuance of detailed guidelines on complaint management at banks and self-assessment framework. It is pertinent to mention here that responsible banking conduct and FTC is one of the key regulatory agendas of the State Bank of Pakistan (SBP). The SBP recognizes that effective and efficient consumer grievance handling mechanisms are crucial elements of the FTC regime, therefore, it considers consumer complaints as an opportunity to improve banking services and increase customer satisfaction. This increase can be attributed to improved visibility and access of dispute resolution mechanisms coupled with enhanced consumer awareness. Further, this is also due to the fact that the number and value of banking transactions have increased substantially. For instance, the volume and value of ATM/debit card transactions have increased by 101 percent and 110 percent respectively over the reporting period. The number of deposit accounts per ATM and per branch shows an increase of 62 percent and 81 percent respectively. Similarly, during 2016 to 2019, volume and value of E-banking transactions have substantially increased by 112 percent and 152 percent respectively on account of a 71 percent increase in E-banking users. In terms of addressing the complaints, the resolution rate over the period 2016-2019 remained above 97 percent at each year’s end. The average time taken for resolution of complaints remained within regulatory turn around times. However, delays were observed in sending acknowledgments, interim and final responses. In order to boost performance of complaint handling at banks and promote competition, the SBP plans to further enhance the related disclosures which may include publishing of bank-wise complaint handling performance indicators in the near future by the SBP. Currently, banks themselves are required to give disclosure about the complaint management in their annual audited account for public information.