Shri M. Damodaran comitte

The Reserve Bank of India has constituted a Committee under the chairmanship of Shri M. Damodaran, former Chairman, SEBI

• no restriction on maintenance of min balance for obtaining facilities of cheque books and atm card
• fixed deposits should not be automaticaly renwed.
• limit of isurance cover for Saving accounts be changed from 100000 to 500000.
• home loan customers should not be penalised for transfering to another bank for low rate interest.
• all documents kept for home loan should be returned withing 15 days.
• not be   penalised for non-maintenance of the minimum balance, being charged for shifting home loans, or having struggled to recover money after failed ATM transactions.
• The committee has suggested a toll-free common call centre number for all banks, which a customer could call and then be diverted to the bank concerned.
• seperate counter for senior citizens/physically chalanged as well, with priority counters.
• offer additional saving bank ccount interest rat as offered in fixed deposits. and no penalty be levid on early maturity.
   

PROPOSED CHANGES

PLAIN vanilla savings accounts without a minimum balance requirement with certain privileges like cheque facility, ATM card, etc without prescribing a minimum balance.

FLOATING rate housing loans with no distinction between old and new customers-  In a floating interest rate scenario, when an entire class of borrowers has the same characteristics and risk level, the point of entry in time (old customers and new customers) should not create discrimination in the interest rate offered. It suggested all home loans permit a switch between fixed and floating rates at least once during the

SWITCH option for home loans at least once during loan tenure

COMMON toll-free call number

COMPENSATION for delayed return/loss of title deeds in banks’ custody

ZERO liability on loss in ATM and online transactions

ENHANCEMENT of deposit insurance cover to '5 lakh

CHIEF customer service officer for grievance redressal in every bank

.

• If the balance in the account fell short of the minimum requirement, the penal charges levied should be in proportion to the shortfall, the report said, adding banks must immediately inform the customer.
•  In addition, all fixed deposit schemes offering different rates for different tenures should indicate the annualised yields so that the customer could take an informed decision.

• The report has also given huge relief to home loan borrowers who continue to pay higher rates while new customers pay lower rates.
• .loan tenure, at a reasonable fee. Banks have been asked to return the title deed agreement to customers within 15 days of the loan closure, failing which the customer be compensated.