Internal ombudsman should ensure fair, timely customer grievance resolution: RBI Deputy Governor
Mumbai, July 20
Reserve Bank of India's Deputy Governor Swaminathan J has urged regulated entities to strengthen their internal ombudsman mechanisms and ensure that customer grievances are resolved fairly and independently within institutions, as per a statement by the apex bank.
Delivering a speech at the Internal Ombudsman Conference organised by the RBI in Mumbai on July 13, 2026, he noted that a significant share of complaints later resolved in favour of customers by the RBI Ombudsman had not been referred to the Internal Ombudsman.
He noted, "Customer service is a shared responsibility that starts with the Board, runs through senior management and operating teams, and ultimately reflects in every interaction that a customer has with the institution. Every one of us present here has an important role to play in strengthening that ecosystem."
He highlighted that, as the financial ecosystem becomes larger, more digital and increasingly interconnected, the need for a strong grievance redressal system has become more important. In this context, he said the Internal Ombudsman mechanism plays a critical role in resolving customer complaints within financial institutions.
Hence, "Internal Ombudsman must therefore bring something that no process manual can fully prescribe--independent judgement, fairness and empathy. These qualities transform grievance redress from a procedural exercise into a meaningful resolution for the customer," he added.
In his speech, he further noted that regulated entities must distinguish between closing a complaint and actually resolving it, as a case may be technically closed after a response is issued while the customer's concern remains unresolved.
He stressed that grievance redressal should focus on delivering a fair and timely outcome, rather than merely justifying the institution's decision, and should be assessed by the quality of resolution-- not just the number of complaints disposed of.
As per the release, Swaminathan J further urged Internal Ombudsmen to exercise independent judgment, ensure fairness in their approach and represent the customer's perspective in institutional decision-making.
"Ultimately, the success of the Internal Ombudsman framework will not be measured by the number of complaints handled. It will be measured by customers' confidence that their concerns will receive a fair hearing and an impartial resolution within the regulated entity itself," he said.
— ANI
Reader Comments
Deputy Governor Swaminathan J has hit the nail on the head. The distinction between "closing" and "resolving" a complaint is crucial. In my experience, most private banks have a mechanised system that sends auto-replies and considers the matter resolved, while the customer is left frustrated. Independent judgement and empathy are exactly what's missing in today's banking culture. Let's see if this translates to action on the ground.
Good to see RBI pushing for better customer service, but I wish they'd also address the delays in RBI Ombudsman itself. I filed a complaint six months ago and still waiting for a hearing. The internal mechanism is fine, but what about accountability for the regulator's own processes? Also, how many customers even know about the Internal Ombudsman? Public awareness is zero! Maybe start an awareness campaign first? 🤔
As someone working in a bank's compliance department, I can tell you the pressure on us is always to close cases quickly, not resolve them fairly. Targets are about numbers, not quality. If RBI really wants this to work, they need to change how banks measure performance of their grievance teams. Otherwise, Internal Ombudsman will just be another box-ticking exercise. But I appreciate the Deputy Governor for raising these important points. 🌟
Interesting piece from the RBI. In the US, we have the Consumer Financial Protection Bureau that oversees similar issues. It's good to see India taking customer complaints seriously. The emphasis on independent judgement and empathy is something many financial institutions worldwide lack. Hope this sets a trend for other sectors too.
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