Bank pays for blacklisting, threatening customer
C Unnikrishnan | TNN
Mumbai: The next time a bank offers a free credit card, think twice before saying yes. An advocate learnt this the hard way when a bank recently went to the extent of notifying his name as a defaulter with the Credit Information Bureau of (India) Limited (Cibil) even though it was not his fault.
The move meant that the advocate, K P Sreejith, would have found it impossible to avail a bank loan. However, refusing to take things lying down, Sreejith sued the bank, which was then directed by the consumer dispute redressal forum to pay up Rs 25,000 towards ‘mental agony and loss of reputation’ and another Rs 5,000 towards cost of litigation.
In August 2007, Barclay Bank approached Sreejith and offered a free life-time credit card considering his “good payment track record”.
Sreejith, who was initially reluctant, accepted the offer. On October 7, 2007, he made a purchase of Rs 918 through the card. A month later, the bank informed Sreejith over phone that he had not made the payment due on November 17.
Sreejith claimed that he had not received the statement but promptly paid the amount in accordance with the bank’s instructions. But soon he got the statement, in which where he was charged Rs 300 towards delayed payment. After Sreejith failed to get through to the bank over the phone, he sent an e-mail explaining the situation and requested them waive off the late fee.
The bank reverted saying the m at t e r had been forwarded to the department concerned. Even as the dispute was on, the late fee amount accumulated to Rs 2,000 and the bank allegedly sent recovery agents, who threatened Sreejith with dire consequences if the amount was not paid.
On January 4, 2008, the bank sent a letter to Sreejith asking him to pay Rs 734 and suspended his card. In February, the bank wrote saying the card would be permanently withdrawn and details would be forwarded to Cibil. On March 3, the bank carried out its threat after which Sreejith approached the consumer forum.
The bank denied issuing any threats and said levying late fee was proper. The bank also said that Cibil is not a defaulters’ list but only a data base of customers’ credit history.
The bank filed an affidavit saying the charges were reversed and there was no outstanding, which was intimated to Cibil.
The forum comprising president S P Mahajan and members Jyoti Iyer and S S Patil observed the bank had no regards for RBI directives as complaints to the customer services head was not attended to.
“The act of the bank in employing recovery agents is highly deplorable and it appears that the bank has no respect for the rule of the law.’’ the forum added.