Swaminathan J. flags bypassing of Internal Ombudsman in grievance redress
RBI Deputy Governor says too many complaints reach RBI Ombudsman without first being referred to the Internal Ombudsman, undermining the framework.
What changed
- RBI Deputy Governor calls for independence, fairness and root cause analysis by Internal Ombudsmen
- Boards and senior management urged to treat complaint data as business intelligence, not compliance statistics
- Technology seen as opportunity but cannot replace judgment, fairness or empathy
The read
RBI Deputy Governor Swaminathan J. has delivered a pointed message to regulated entities: their Internal Ombudsman (IO) framework is not working as intended. A significant proportion of complaints later upheld by the RBI Ombudsman were never referred to the IO in the first place, he disclosed. This undermines the very purpose of the mechanism, to resolve grievances internally before they escalate. His remedy is threefold: IOs must be independent, fair and the voice of the customer; boards must treat complaint trends as early warning signals rather than compliance data; and entities must move from complaint closure to meaningful resolution. The speech, published in the RBI’s July Bulletin, makes clear that the regulator expects more than procedural compliance. It expects a cultural shift. Institutions that treat grievance redress as a cost centre rather than a core function will face increasing regulatory attention.
Key numbers
- Observation: a significant proportion of complaints ultimately resolved in favour of customers at the RBI Ombudsman level were not referred to the Internal Ombudsman in the first place.
Primary source: rbi.org.in