RBI to prescribe new pricing guidelines for bank products
31 December 2012
The Reserve Bank of India will prescribe new guidelines for pricing of bank products. RBI governor D Subbarao will announce the new guidelines at the Ombudsman Conference to be held on 4 January, RBI deputy governor K C Chakrabarty said on Saturday.
Chakrabarty cautioned banks against charging high prices on products offered to customers. "Some new guidelines will come on how it (RBI) can be more stringent in pricing the products to customers of banks", he said.
Chakrabarthy was talking to reporters on the sidelines of a function to release a book 'Indian Banking Reforms and After', written by banker Dharmalingam Venugopal an employee of Indian Overseas Bank employee.
"I am telling you that if you believe that the pricing has become exploratory then we will intervene. We have intervened in the case of micro-finance institutions. What I am saying is, discriminatory pricing should not be there. Pricing should be non-discriminatory," Chakrabarty said.
"You have to understand the customer needs and be reasonable to customers," he said, adding, "do not do lip service."
He cited the instance of some banks charging high interest rates for offering educational loans compared to home loans. "I am only raising a question why it cannot be reduced," he said.