Pranav Bakshi is a top-notch official with a multinational company based in Germany. He has, on an average, at least five credit cards of different banks stashed away in his wallet.
Pretty naggingly, almost every morning, he wakes up to a call or the other from one of the direct selling agents of his bankers, informing him of an enhancement of his credit limit or asking him about something else.
Finally, the day has arrived when Bakshi -- million others like him -- can heave a sigh of relief. Now it is Bakshi and people like him who will be calling the shots - and not their bankers.
According to the latest guidelines issued by the Reserve Bank of India, no card-issuing bank can unilaterally upgrade credit cards or enhance credit limits.
The RBI has now made it mandatory for and binding upon banks to seek prior consent of cardholders before they carry out any changes in the terms and conditions.
It is not only about credit limit, the RBI has also asked banks to seek prior approval from cardholders pertaining to the numbers on which they do not wish to receive calls.
Well for this, what you need to do is log on to your bank's website and simply register yourself under the 'do-not-call' registry (DNCR). You could also communicate your need for privacy through a letter addressed to the card-issuer.
Gone are the days when banks would bombard you with free-for-life cards sent to you without your having applied for one. The RBI guidelines clearly bar banks from indulging in such activities.
So, the next time you get a call on your mobile, informing that a free credit card has been issued or mailed to you, you can indeed take the card-issuing company to task.
The central bank's guidelines necessitate that the card-issuing bank should maintain a DNCR, containing the phone numbers of all customers and non-customers, who have informed the concerned entity that they do not wish to receive unsolicited calls/mails for marketing of credit card products.
In fact, the banking regulator has gone one step ahead. It has stipulated that if unsolicited cards are issued without consent and bills raised for the same, the card-issuing bank will have to pay twice the amount billed as penalty.
While accepting credit cards, read the fine print of the terms and conditions related to the issuance and usage of cards. Now onwards banks are bound to highlight the MITCs (most important terms and conditions) to prospective customers at all the stages of communication.
The next time when you see a monthly interest rate of just 2.50/2.75 per cent, do not get flattered as they seem much lower than an annual rate of 8 per cent on a housing loan.
In line with other products and services, banks are expected to quote an APR (annualised percentage rate) for their credit cards. So, instead of saying 2.50 per cent per month, banks will have to state the interest rate in terms of annual figure, say, 30 per cent (per annum).
The late payment charges, including the method of calculation of such charges and the number of days, will be prominently indicated. The manner in which the outstanding unpaid amount will be included for calculation of interest will also be shown conspicuously in all monthly statements.
Further, to address and redress cardholders' grievances/complaints, banks will now have to constitute a machinery and place all the information on their websites. If a customer does not get a satisfactory response from his banker for within 30 days of lodging a complaint, he can approach the banking ombudsman for solutions.
Banks can no longer get away with harassment caused to customers or prospective customers. The credit card issuers would now be liable to compensate the complainant for any loss of his time and finance, expenses incurred by him, as well as harassment and mental anguish caused to him.
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