Banks will not be able to create any pressure on customers to buy financial products. For this, the Reserve Bank (RBI) is going to make strict rules. The central bank has announced to create new guidelines in this regard. This will prevent the miss-selling of the financial products of banks. RBI deputy governor M Rajeshwar Rao told about this on 7 February. He said that this will prevent practices that damage the interest of customers.
RBI deputy governor told about the dangers of miss selling
He also said that the central bank wants to provide a similar opportunity for the financial services sector. They said that Rbi Miss-selling of financial products will not be tolerated. He said that banks are involved in such activities through their subsidiary or related companies. This creates two types of anxiety. First, when the bank or its subsidiary are in the same business, there is a conflict of interest. Second, it also causes problems in terms of regulation, as there are different rules for banks and different rules for NBFCs.
The central bank has received many complaints of miss selling
He said that there are their dangers to allow banks to adopt methods like NBFCs. This statement of RBI deputy governor is considered very important. The central bank had received several complaints about banks being involved in miss-sale. Often banks pressurize their customers to buy financial products that they do not need. This causes damage to customers. Due to pressure, they buy such products.
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Banks try to sell products from other companies to customers
Many banks try to sell products from their subsidiary companies to their customers. Many times they use their distribution channels to sell products from other financial companies. Its targets of the employees of banks are given. This forced them to force customers to buy such products. Many times emphasis is laid on selling such products to meet the target. This makes banks income as commission.