Join the forum of "Safe E Banking in India"
When we are now remembering the 10th anniversary of the terrorist attack on the World Trade
Center in New York which marked the beginning of a crusade against
Terrorism led by USA. India should be considered as a prominent member
of this crusade though we are more a victim than a fighter in the cause.
A similar situation now exists in the fight against Unsafe E Banking
services prevalent in India to which Naavi has been drawn drawn through
circumstances. Being an ex-Banker with a service oriented approach
through out his career, it has been a tough time for Naavi to witness
the victimization of Indian Banking Customers in pursuit of technology
and the profit motive of the current generation Banks.
Naavi started his E-Business Consultancy career more as a marketing person
advocating the use of Internet Technology for Banking since around 1998.
Later, as Naavi entered deeper into Cyber Law Education, Naavi continued
to promote security measures such as the use of digital signatures to
build a trusted Internet environment. In the meantime the security
scenario in Internet took a decisive change with organized criminals
targeting the expanding universe of Internet users and conning
them to various frauds. The need for a "Secure Internet Environment" was
only increasing to the extent it was necessary to change our perspective
of Internet as a "Medium of Free Expression" to a "Medium of Responsible
Expression" and playing down the importance of "Anonymity" and
supporting the cause of the Law enforcement for close monitoring of
Internet even if it reduced the sense of freedom in the society.
In the midst of all these developments of increasing threats and
vulnerabilities, Indian Banking industry went ahead with large scale use
of Internet technology for customer interaction to the extent that
'Internet/Electronic device based interaction' is today considered the
more natural interaction with the customers and many Banks impose a
financial cost for customers who want physical interaction. There are
Banks who say that you cannot use cheques for more than a few times to
draw cash or to be issued to a payee who wants to draw cash from a
branch other than the parent branch etc. Passbooks are discouraged and
e-mail statements are preferred. Across the desk complaints are
discouraged and online complaints are encouraged. Intercity cheque
collection is discouraged and NEFT is encouraged. In effect E-Banking is
becoming more the norm than an option.
While for a technology enthusiast like me this migration from Physical
Banking to E-Banking is exciting, the bug is the increased risk of loss
of money which the customers are exposed to.
Insecure Technology is Undesirable:
In view of the increasing threats and costs which customers are forced to
bear, I often wonder if technological development which affects the
basic security of Banking is in deed desirable? The introduction of
M-Banking makes me even more worried.
It appears that Commercial Banks are driven by the greed of profit
and would not mind sacrificing the safety of Banking if they can make
more money. A Customer today is a "Profit Opportunity Center" and after
luring a customer into opening an account, various kinds of service
charges are hoisted on him some with his permission and some without.
Simultaneously whenever the technology deficiencies result in a financial
loss to the customer in the form of Phishing etc., the customer is told
that he should bear the liability and not the bank.
Since E Bankers in India have become untrustworthy, it is time for RBI to
review the technology thrust in Banking that it started in all
earnestness in the 80s.
RBI Needs to Strengthen Deterrence Mechanism
Reserve Bank of India has tried in vain to impose security obligations on
the Bank. It has told in no uncertain terms in the Internet Banking
Guidelines of June 14, 2001 that the laws of Banking in the physical
space continue in Cyber space and all consumer protection laws
applicable to physical banking also apply to Internet banking. They also
stated that if Banks introduce technology which is not recommended in
law (eg: authentication by password instead of digital signatures) then
they should bear the legal risk and cover themselves with an insurance.
Despite these instructions being reiterated by the G Gopalakrishna working
group (GGWG) report and further by the Damaodaran Committee report,
Banks continue to ignore the RBI as well as the law. This has made it
necessary for customers to fight legal battles when there need not be
Naavi has been assisting Bank customers who are victims of fraud related to
ITA 2008 in pursuing legal remedies through Adjudication as well as
other collateral means such as Banking Ombudsman and Consumer forums.
It is however becoming increasingly clear that Banks are trying to come
together in an unholy alliance to continue their insecure methods of E
Banking at the expense of the customers and trying to manipulate the
legal processes as well as the administrative processes. It has become
common for the banks to make blatantly false pleadings before judicial
forums that they are following RBI guidelines and are not at fault in a
fraud scenario. Now in some cases I have observed that such false
pleadings are also made in official letters sent to RBI.
There are indications to conclude that Banks are also trying to manipulate
the Government decisions for their advantage through various means.
Though RBI has been forthright in its circulars and notifications, it
appears to be failing in imposing discipline through appropriate
deterrence mechanism. The GGWG notification is however an attempt to fix
accountability of Bank Chairmen through disclosures in annual reports
and hopefully this should work better than in the past. However it is
not clear if even this measure will be trivialized by Banks by making it
a formality which they can bluff through.
Time has come for RBI to therefore consider quick measures such as
exemplary fines and notifications in the service records of officials
and imposing token personal fines on the officials for the lapses as in
the RTI Act.
Organizing Public For the Cause of Safe E Banking
Naavi as an ex-Banker would like to challenge the unethical efforts of
Banks and bring justice to E-Bank customers. Presently legal options are
under suspension since the Cyber Appellate Tribunal is not functional.
The only option available for Bank customers is the administrative
option through the Banking Ombudsman and Service deficiency complaint in
a Consumer Forum. Some of the Banking Ombudsmen are unable to appreciate
their role and blindly support the Banks. The system therefore is not
functioning as well as it should. The Consumer forums are taking too
long a time to settle cases and customers are getting frustrated.
It has become necessary therefore to launch a comprehensive crusade for E
Banking safety addressing several organizations Legal, Administrative
and Government. Naavi is presently in continuous discussion with RBI,
Adjudicators/Cyber Appellate Tribunal, the DIT, Parliamentarians etc.
Some requests have been sent even to the President of India, Chief
Justice of India, the Prime Minister, Finance Minister etc. for
persuading the operative departments. The progress however has been
There is also a need to persuade software developers such as Infosys,
Polaris, IFlex, TCS etc who have a stake in Banking software to
contribute to safe E Banking through appropriate up gradations to their
There is also a need to support victims of Bank frauds to pursue their
complaints with various organziations.
I need public support for this "Crusade against Unsafe E Banking" in
the form of volunteers in different cities..in particular all the State
Capitals who can personally meet relevant officials and pursue the
agenda of "Safe E Banking. Volunteers who can work in unison across the
country are invited to join the forum of "Safe E Banking in India".
Please join the forum today by sending an e-mail to
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