Date:09/08/2008 URL: http://www.thehindu.com/2008/08/09/stories/2008080954990801.htm

Opinion - Letters to the Editor

Credit card blues

The editorial “Credit card blues” (Aug. 8) is indeed an eye-opener. There is no doubt that the quality of customer service in various banks has gone awry. The desperation of banks ends once their business objectives are realised. I know of an instance in which a nationalised bank settled a credit card-holder’s account and issued a proper settlement letter. Well after two months, the police arrived at his house with an arrest warrant. This happened only because of the reckless attitude of the bank branch in Chennai, which did not inform its Delhi office about the settlement. The serious lapse on the part of the bank led to immense humiliation for the client, causing him serious mental agony.

A.P. Thiruvadi,

Chennai

Although the RBI has issued guidelines for credit card-issuing banks, they do not follow them. Loss due to default is the result of poor or improper assessment of customer’s creditworthiness. Banks, including those in the public sector, have entrusted the job of adding new customers to agencies. These agencies have little knowledge regarding their venture. All they can think of is aggressive canvassing techniques. They seldom explain the pros and cons of credit card to a prospective customer. He is lured into buying an add-on card, which he may not need.

When a customer defaults, the bank is happy that it can get a higher interest. Hence, it does not remind him of his dues. When banks feel customers are not ready to pay, they resort to all forms of abuse and atrocities. A system should be evolved in which a defaulter cannot get credit after a specified period, even if he makes a minimum payment.

Another equally important aspect is the poor service to genuine and prompt customers. Card thefts and illegal uses are detected only after a considerable time has lapsed. Unlike as in mature markets like the U.S., very few banks have the provision to alert customers on their transactions instantly through SMS or the Internet. Customers come to know about their transactions only when they receive their bills. A good customer service, which is not aimed at profit-making alone, will help in improving the situation.

P.G. Harikumar,

Kaiga