In a recent development, HDFC Bank refunded foreclosure charges to a customer in a long-running dispute. Chartered Accountant Atul Modani had two home loan accounts with HDFC Bank. The bank charged him foreclosure, amounting to Rs 59,000 after he sought to close the loan accounts. He contended these charges ran contrary to the terms of the loan agreement.
For a month, Modani was discussing with HDFC Bank to waive foreclosure charges, but the bank refused to yield. Annoyed, he brought it to the RBI Ombudsman. The RBI, after a proper investigation, concluded that the foreclosure charge was unfair and asked HDFC to refund the amount.
The RBI decided that HDFC Bank would have to refund foreclosure charges of Rs 59,000 to Modani. The bank also provided Rs 10,000 as compensation against harassment. Thus, Modani got a total of Rs 69,000. He posted his victory on social media stating how happy he was with the results.
HDFC Bank refunded foreclosure charges, but social media users say the amount was too less
The case of Modani established the efficiency of an RBI Ombudsman in settling consumer grievances. After HDFC Bank refunded foreclosure charges following this incident, it went viral on social media. Many requested giving more respect to the decision Modani had taken and criticized the compensation being too meagre.
One of the users penned:
The fine paid by @HDFC_Bank is far too low, the bank personal who has signed on foreclosure charges should be made to pay the fine for wrongdoing. @RBI only then will this nuisance stop.”
Another user wrote:
10000 is very small compensation for such a big bank. 100000 at least should be awarded.”
This brought into perspective the fact that, in case of unjustified charges levied by the banks, help is available from the RBI Ombudsman. People need to lodge complaints formally with the banks and, if the said issues are not redressed within 30 days, people can approach the Ombudsman of the RBI. The whole process is digital and a cinch.
Along with Nikhilesh Kataria, the Modani case became a textbook example for other consumers. It taught them an essential lesson about knowing their rights and not being charged overpriced. For instance, HDFC Bank refunded foreclosure charges and finally backed down as well as treated the customer fairly.
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