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Click to complain. Regulators get active

They are listening: Financial sector watchdogs are beginning to use technology to integrate their systems with companies to monitor consumer complaints and ensure speedy redressal. Deepti Bhaskaran, Kayezad E Adajania and Vivina Vishwanathan reports.

business Updated: Jun 22, 2013 02:14 IST

As you climb the stairs of Parisrama Bhavan in Basheer Bagh to reach the Insurance Regulatory and Development Authority (IRDA) office in Hyderabad, you are greeted by a billboard in the stairwell that asks: Is your insurance company listening to you? If not, the billboard goes on, you can register your complaints online and track their status through Integrated Grievance Management System, IGMS, or call at 155255.

This in fact is the first board you see before you enter the office. Its placement is indicative of the regulator's focus and its effort to reach out to aggrieved customers directly. And IRDA is not alone in this regard. Capital markets regulator Securities and Exchange Board of India (SEBI), too has taken some institutional measures in the form of SEBI Complaints Redress System (SCORES) to effect speedy disposal of complaints.

In fact, SCORES is a step ahead because it also claims that it adjudicates on a case to case basis to ensure fair settlement. The mandate for IGMS, however, is to ensure speedy settlement of complaints and not adjudication. This is true even for the Standardised Public Grievance Redress System or SPGRS, that the ministry of finance has put in place only for the public sector banks (PSBs) for now.

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Read on to understand the processes of consumer grievance redressal set up.

Capital markets and mutual funds
SEBI set up SCORES in June 2011. So if you have a grievance with your investments that come under SEBI's jurisdiction, such as mutual funds (MF), equity shares, depository participants (DP) and brokers, you can complain directly to SEBI through SCORES.

Visit SEBI's website (www.sebi.gov.in) or www.scores.gov.in, fill in your basic details, register your complaint, submit any documents that you may have as evidence and sit back. SEBI, then, forwards your complaint to the firm and keeps a track of it. You could, alternatively, send your complaint to SEBI by post.

To ensure that the company against whom the complaint is filed actually receives the complaint, SEBI has made it mandatory for every listed company, MF, stock exchange, depository and so on, to nominate one person in charge of investor complaints. When SEBI gets a complaint, it sends an alert message to this official within seven days; he is then mandated to look into it. Though SEBI has not specified a fixed time limit within which the firm must respond, it mandates the company to send its first response within seven days of receiving the complaint and then about another 30 days generally to resolve the complaint. If the firm fails to respond, SEBI sends one to two reminders to the firm. If you have submitted the complaint online (on SEBI's website), your firm will email you the response and will also update SEBI. If you complain by post, the firm sends you its reply by post, and it is mandated to mark a copy to SEBI.

If you are unhappy with the company's response, you can go back to SEBI and tell them to take a relook at it.

Insurance
IGMS was set up by IRDA in 2011. It works like a central repository of all the consumer complaints received by life insurance and non-life insurance firms. In that sense it's a handshake between IRDA's grievance management system and the insurer's individual grievance management system. The way it works is like this. You can register a complaint either through mail, phone or even verbally with an insurance company and the insurer will register that complaint in its grievance management system. In fact it is mandated that every insurer must have a grievance redressal policy approved by IRDA and a grievance cell that will be presided over by a nominated person from the board.

Once your complaint gets registered, it will automatically flow in the IGMS which is monitored by IRDA. IRDA gives the insurer 15 days to settle the complaint. "Regardless of the nature of grievance, insurers have 15 days to settle the matter. However, 15 days start from the day of receiving all the necessary documents and proof," said Yateesh Srivastava, COO, Aegon Religare Life Insurance Co. Ltd. If your complaint is not settled within 15 days, the system will raise a red flag so that IRDA can take note of the delay and direct the insurer to settle the complaint. You can also approach IGMS by logging into www.igms.irda.gov.in or calling up the toll free number 155255. However, IRDA encourages you to approach the insurer first.

"We used to submit data on complaints even earlier but it was post-facto. So, the idea of IGMS was to track complaints and the effectiveness and timeliness of response on a real time basis. The regulator, however, depending upon the trends that complaints throw up, can always question the insurer," says TR Ramachandran, CEO and managing director, Aviva Life Insurance Co. India Ltd. In other words, IRDA could go beyond the mandate.

Banking services
Except for PSBs, the banking sector lacks a similar integrated redressal system. In case of the PSBs, the department of financial services under the ministry of finance has put in place an online complaint redressal facility and inked guidelines on SPGRS last year. This SPGRS forms needs to be uploaded on the website of the PSBs.

The idea was to meet the rising expectations of customers for prompt redress of their grievances. This system again works like a repository in the sense it integrates complaints received from multiple channels into a common digital platform. The bank in question is expected to solve grievances within three weeks or 21 days. The system has an inbuilt management information system for analysing performance. "The SPGRS is one of the ways to send complaints, " said Says VN Kulkarni, chief counsellor, Abhay Credit Counselling Centre. "However, the issue of resolving consumer complaints faster still remains. The move is in the right direction, but number of days to resolve the grievance should have been reduced further."