By Harjeet Khanduja

Ashish was half asleep when his phone vibrated at 6 A.M. on a Saturday morning. It was an SMS from the bank informing him about a transaction of INR 11,300 made using his credit card. His wife might have used his card he thought. Ashish slept for another two hours. Then Ashish looked at the SMS again to realize the zero error in his reading. The transaction amount was INR 1,13,000. This was a case of credit card fraud! Ashish called his brother and he advised him to –

  1. Block his card immediately.
  2. Report the case to the bank call centre.
  3. Report the case to the nearest Bank Branch and take a hard copy receipt of the complaint.

Ashish reported it to the call centre and asked them to block the card. Consequently, the card was blocked. Ashish went to the bank branch and filled the Card Holder Dispute Form.

First of all, He reported it to the call centre and asked them to block the card. Consequently, the card was blocked. He went to the bank branch and filled the Card Holder Dispute Form. The bank manager assured him that there was nothing to worry about and that everything would be taken care of. A week passed by, he did not hear from the bank. When he enquired again, the bank asked him to submit the Card Holder Dispute Form once more. He patiently did it.

This became a routine. Every time Ashish called, the bank asked him to submit the form for enquiry and every time he was provided with a new email ID. In a period of 10 days, he submitted the form to the bank seven times at different email IDs. After the enquiry was completed, the bank told he that it was an online transaction. Furthermore, the bank concluded that the transaction was done by Ashish himself. Hence, he will have to pay for the transaction. The bank went ahead and made the payment to the merchant. He was in shock.

He searched on the internet and found a forum where such cases were being discussed and he connected with the forum owner for advice. First of all, the Forum owner consoled and counselled him. He was delighted to know that even after signing a ten page agreement, he has certain rights as a consumer. He guided him to –

  1. Ask for the details of the transaction.
  2. Regularly communicate with the bank and record every communication.
  3. Study the dispute resolution guidelines on the bank website.
  4. Report the case to Nodal Officers and Police.

Ashish asked the bank for the details of transaction and also asked for the IP address used for the transaction; the website through which the transaction was conducted; details of the merchant; address of the merchant; details of the product purchased, delivery location of the product and details of the person who signed the delivery form. The bank did not respond initially. Finally he found out that the transaction was made in Las Vegas, United States and a dog was bought. Interestingly the merchant website did not have any online purchasing facility. He called up the merchant and found that transaction was done physically at the store. But there was a problem, while the merchant confirmed this verbally he was not ready to give it in writing.

Finally Ashish found out that the transaction was made in Las Vegas, United States and a dog was bought. Interestingly the merchant website did not have any online purchasing facility.

Ashish reported the case to all Bank Nodal officers with the Card Holder Dispute Form. Furthermore, when he reported the case to the nearby police station the police refused to write the complaint. They said that because the crime was committed in Las Vegas the complaint should be written in Las Vegas police station. After another four days of pleading, he was directed to the cyber-crime cell. Cyber-crime cell registered the complaint and sent a notification to the bank. This was also a deadlock situation. He took a cue and reported the case to Las Vegas police. Since the crime happened in Las Vegas, Las Vegas police was ready to help but they wanted him to be physically present in Las Vegas for them to take any action. Since, they were not sure about the authenticity of Ashish.

After another few rounds of discussion, Las Vegas Police said that if the Indian police faxes them the details of Ashish and his complaint, they will consider it. He managed to get a letter from the Cyber-crime cell and faxed it to the Las Vegas Police. Yet the Las Vegas Police did not act on the case.

He kept writing to the bank about the facts and blamed them for not helping. Each email of Ashish was a two page mail to which the bank had a standard reply stating- “We are working on your case and we will come back to you in 50 days”. He started questioning the investigation process of the Bank. He asked, “When the Bank says that it shall respond in 50 days, do they mean from the date of transaction or from the date of reply?”. Hence, he kept accumulating these emails and lamented that the bank has such a casual attitude towards the case.

RBI proposed that the consumer will have zero liability where the consumer reports the case immediately and consumer’s own involvement is not established.  In cases where the consumer reports it within 4 to 7 working days and consumer’s own involvement is not clearly established, consumer liability shall be limited to a maximum of INR 5000.

After three months, he wrote a detailed note attaching all the communications and facts to Reserve Bank of India (RBI). Since, one can write to the RBI, if the bank does not resolve the case to the satisfaction of complainant. The RBI, then calls for arbitration where both the consumer and the bank present their case.

While Ashish was waiting for days, there was no response.

He had lost all hope when one day he got a reply from RBI. RBI had studied the papers sent by him. RBI found the evidence so strong that without arbitration RBI advised the bank to reverse the payment. He regained the faith in the Indian Banking System. One entity doing its job right can change the face of the system in the eyes of consumers.

RBI's proposal has strengthened consumers' faith in banking | Photo Courtesy: Visual Hunt

RBI’s proposal has strengthened consumers’ faith in banking | Photo Courtesy: Visual Hunt

Keeping in mind online frauds, RBI proposed that the consumer will have zero liability where the consumer reports the case immediately and consumer’s own involvement is not established.  In cases where the consumer reports it within 4 to 7 working days and consumer’s own involvement is not clearly established, consumer liability shall be limited to a maximum of INR 5000. The proposal shall further strengthen the confidence of the consumers in the Indian Banking system.

However, the consumer will have a responsibility of establishing his non-involvement in the transaction, like Ashish did.


Harjeet is the Vice President HR at Reliance Jio Infocom. 

Featured Image Credits: Wise Bread

Fresh insights delivered to your phone each morning. Download our Android App today!

Posted by The Indian Economist