As per the Reserve Bank directive issued in May 2012, no bank can put back into circulation currency notes (of R100 and higher denominations) received by them, without first processing them for authenticity.
And this should be done through machines conforming to standards prescribed by the regulator. In other words, the banks are duty bound to ensure that no counterfeit note comes out of an ATM.
Yet, you find banks violating this directive and the consumer suffers because invariably banks refuse to take responsibility for their negligence, in clear violation of the RBI directive. In fact, they refuse to accept that the fake note came out of their ATMs and express their ‘inability’ to replace the fake with a genuine note.
I remember a case decided by the Andhra Pradesh State Commission in 2008, in which a retired school teacher who encashed a cheque of R1 lakh from a bank branch was given counterfeit notes to the tune of R37,500.
When he took the entire bundle to deposit in another branch of the same bank, the bank argued that it was the duty of the customer to check the veracity of the notes and refused to replace the counterfeit, forcing him to eventually seek the help of the consumer court.
Asking the bank to make good the loss suffered by the consumer , the commission criticised the bank for trying to make the teacher pay for its mistake of accepting counterfeit notes from two persons, as shown by police investigation later.
So long as the Reserve Bank does not crack the whip on banks and hold them accountable for violating its directives, consumers will continue to get fake currency notes through ATMs.
In fact, in addition to sorting out the currency through machines, the banks should also be instructed to equip the ATM machines with the intelligence to detect and reject fake notes.
Banks should also be asked to adopt the international practice of ‘casette swap’ system, wherein sealed and secured cassettes of currencies are used to refill the ATMs.
This would ensure that outsourced agencies or bank employees do not switch notes when ATMs are being loaded.
In short, the regulator and the banks should take responsibility for ensuring the genuineness of currency notes coming from banks, so that consumers are not harassed and robbed of their money.
Himat Singh: On the night of February 10, I withdrew Rs.5,000 from a public sector bank ATM and was shocked to find that one note of R1000 was fake. But the bank is now refusing change the note. How can I recover my money?
Keep your ATM receipt safe and also copies of your complaint to the bank. Send photocopies to the nodal officer of the bank and demand that the bank replace the fake with genuine currency. If he refuses to comply, you have an option of going to the Banking Ombudsman or the consumer court.
Consumer courts have clearly held that violation of the regulator’s directives constitutes deficiency in the service rendered and a consumer who suffers on account of such deficient service is entitled to compensation. So you will certainly get relief there.
To strengthen your case, I would also suggest that you find out through RTI, what kind of measures the bank has put or not put in place to ensure that fake currency notes are not place in the ATM. Also try to find out if there are more such complaints against the bank. The answer, I am sure, will give you lot of information to nail the bank.