whether the charges for SMS alert fee being deducted by Punjab National Bank are ethical?
whether the charges for SMS alert fee being deducted by Punjab National Bank are ethical?
This blog had earlier published following articles on SMS alert fee being charged by banks specially State Bank of India (SBI) to draw the attention of the Bank, Regulator namely Reserve Bank of India (RBI) and Ministry of Finance. The links to the articles are given below for an easy access.
1. Do the charges for SMS services being charged by State Bank of India are ethical?
2. Unethical business revenue by banks on account of charging SMS Alert Services
3. Need for intervention of Reserve Bank of India to put a stop on the unfair business practices of the Commercial Banks on a/c of SMS Alert Fee amounting to estimated Rs. 5,000 crores in a year
4. Is State Bank of India adapting unfair trade practices?
This article is being published as it has now come to the notice that Punjab National Bank has also been adapting to unethical business practices on SMS Alert Fee revealed through RTI and more shockingly is despite Ministry of Finance has also advised all the banks to follow the regulations issued by Reserve Bank of India way back in November 2016. The circular issued by RBI has already been referred in my previous articles.
A quote from Reserve Bank of India order No. RBI/2013-14/381
DBOD. No. Dir. BC. 67/13.10.00/2013-14 dtd. Nov 26,2013 on the subject is
DBOD. No. Dir. BC. 67/13.10.00/2013-14 dtd. Nov 26,2013 on the subject is
"Accordingly, with a view to ensuring reasonableness and equity in the charges levied by banks for sending SMS alerts to customers, banks are advised to leverage the technology available with them and the telecom service providers to ensure that such charges are levied on all customers on actual usage basis."
It is surprising that Punjab National Bank (PNB) being one of the largest PSU Banks has not even cared about Central Bank i.e RBI order and is still charging the SMS charges from their customers with a minimum of Rs. 15/- per quarter. PNB issued their order for rates of SMS alert service w.e.f 1st July 2013 after SBI started charging SMS alert fee from 1st June 2013. Realising disproportionate service fee being charged by commercial banks, RBI issued directions on 26th November 2013 to charge customers on actual usage basis. Since RBI is the regulatory body for banking services in India, all banks including PSU banks are required to follow their directions/ regulations/advises. The charges in excess of actual usage can be very well termed as "Unethical Business Practices" and Punjab National Bank need to immediately look into such lapses.
Based on the information received from PNB on SMS alert fee being charged in one of SB account on sample basis, summarised in the following table shall be quite relevant to look at SMS alert fee being charged as unethical business practices. Surprisingly when no SMS has been sent in the 4th quarter, the deduction of Rs. 17.70 is shocking. When there are only 4 transactions in one year, charging of Rs. 70.80 towards SMS alert fee i.e Rs. 17.70 per SMS is no where can be seen as an ethical business.
It is surprising that Punjab National Bank (PNB) being one of the largest PSU Banks has not even cared about Central Bank i.e RBI order and is still charging the SMS charges from their customers with a minimum of Rs. 15/- per quarter. PNB issued their order for rates of SMS alert service w.e.f 1st July 2013 after SBI started charging SMS alert fee from 1st June 2013. Realising disproportionate service fee being charged by commercial banks, RBI issued directions on 26th November 2013 to charge customers on actual usage basis. Since RBI is the regulatory body for banking services in India, all banks including PSU banks are required to follow their directions/ regulations/advises. The charges in excess of actual usage can be very well termed as "Unethical Business Practices" and Punjab National Bank need to immediately look into such lapses.
Based on the information received from PNB on SMS alert fee being charged in one of SB account on sample basis, summarised in the following table shall be quite relevant to look at SMS alert fee being charged as unethical business practices. Surprisingly when no SMS has been sent in the 4th quarter, the deduction of Rs. 17.70 is shocking. When there are only 4 transactions in one year, charging of Rs. 70.80 towards SMS alert fee i.e Rs. 17.70 per SMS is no where can be seen as an ethical business.
Punjab National bank
|
|||
Duration (2018-19)
|
No. of SMSes
|
SMS Alert Fee deducted
|
Cost per SMS
|
1st
Qtr
|
1
|
17.7
|
17.7
|
2nd
Qtr
|
1
|
17.7
|
17.7
|
3rd
Qtr
|
2
|
17.7
|
8.85
|
4th
Qtr
|
0
|
17.7
|
Infinity
|
Total
(2018-19)
|
4
|
70.8
|
17.7
|
The article is being emailed to PNB, RBI and the responses if any received shall be posted on the blog as comments in the article accordingly.
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