While providing banking is a privilege, using banking is the right of every citizen, in the words of the central bank governor, as he echoed the sentiments of a report released on Friday to address issues faced by bank customers.
‘Banking services are not meeting our requirements!’ is the constant refrain that emerges from the complaints that the Bank of Mauritius has been receiving from bank customers.
Almost two years after investigating the terms and conditions of banking contracts, including fees and charges, the Bank of Mauritius (BoM) has released on Friday 06 June 2014, the Report of the Task Force on Unfair terms and Conditions in banking contracts.
The report entitled Banking Your Future: Towards a Fair & Inclusive Banking Sector aims to provide an in-depth understanding of the terms and conditions governing contracts between a consumer and a financial institution and to help both parties achieve a better outcome in their interactions.
“Far from being a bank-bashing or central bank-bashing exercise, the report is a call on banks to partner with the Central Bank in its endeavor to get everyone a fair deal,” said central bank governor, Rundheersing Bheenick.
He added that banks must go “beyond the balance sheet” and pay closer attention to the customer’s interests.
Sonali Sewraj-Reetoo, the Chairperson of the Task Force, mentioned that the voice of customers had not gone unheard. In fact, some grievances had even been reproduced verbatim in the report to reflect the strong sense of dissatisfaction among users of banking services.
She noted that the report contains 100 recommendations including the abolition of 19 fees and the review of 13 others. These recommendations will be widely disseminated across the island in the effort to ensure fairer and more inclusive banking.
Additionally, the recommendations rest on ‘The Eight Pillars of Fairness’ and ‘The Seven Principles’, where the successful implementation of all the central bank’s recommendations will help both banks and customers achieve a fairer deal, whilst limiting the need for constant regulatory intervention.
As the reshaping of the banking industry will require the collaboration of all and that these far-reaching changes will not happen overnight, the BoM has invited all banks to see in these changes an opportunity, an opportunity to connect with their customers, an opportunity to improve their image in the eyes of the public and finally, an opportunity to rebuild the trust that befits the role of a bank.
Since the Bank of Mauritius will be making policy decisions on the basis of the recommendations made, it has sought comments from the public at large, non-governmental organisations, welfare associations, and banking and real sector operators, to enable it to take informed decisions.
Finally, the governor announced some measures being examined at the central bank to spur household savings. He mentioned that it had come as quite some surprise to BoM last month when some banks announced that they were reducing their savings deposit rate.
Accordingly, the central bank and the Treasury are working on the issuance of short-term Bank of Mauritius Savings Certificates and 5-year Government of Mauritius Bonds which will be offered at attractive rates of return to households through participating banks and through the post office network.
Image (Bank of Mauritius): Governor Rundheersing Bheenick released on Friday 06 June 2014, the Report of the Task Force on Unfair terms and Conditions in banking contracts, after almost two years of thorough investigation.
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