services failure and customer handling

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INTRODUCTION

The first development bank In India incorporated immediately after independence in

1948 under the Industrial Finance Corporation Act as a statutory corporation to

pioneer institutional credit to medium and large-scale.

The Industrial Development Bank of India (IDBI) was established on 1 July 1964 under

an Act of Parliament as a wholly owned subsidiary of the Reserve Bank of India. In 16

February 1976, the ownership of IDBI was transferred to the Government of India and

it was made the principal financial institution for coordinating the activities of

institutions engaged in financing, promoting and developing industry in the country.

The Bank has one of the highest productivity per employee in Indian banking industry.

The main aim behind the setting up of IDBI was to provide credit and other facilities

for the Indian industry, which was still in the initial stages of growth and development.

After the transfer of its ownership, IDBI became the main institution, through

which the institutes engaged in financing, promoting and developing industry

were to be coordinated.

IDBI's Strengths Internationally Trusted Bank

Banking company with unique combination of strongdevelopment banking and modern commercial banking

Expertise in banking field for over 4 decades

One stop to meet all corporate needs


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Strong Corporate Brand

Mitigates the counter party risks to buyers and sellers

Provides Complete Solution from Conceptualization toCommercialization

Willing to perform role of Cluster Manager

Long-term Business Partner

Provides various structures for trading of CERs to suit clientneeds

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SERVICES FAILURES BY IDBI BANK:

Operational Risk ;

IDBI Bank measures, monitors and controls operational riskthrough a software system 'ORBIT' (Operational Risk BusinessIntelligence Tool). Branches are rated for their operational riskprofile through an embedded branch-rating model using Key RiskIndicators (KRIs) developed for various business lines. IDBI Bankhas put in place a policy for 'Know IDBI Customer' (KYC) and 'Anti-Money Laundering' (AML) requirements. As a measure ofOperational Risk Management, IDBI Bank also conductsappropriate training programmes to sensitize line managersacross IDBI Bank on operational risk inherent in each function.

As a part of implementation of Basel-II guidelines, IDBI Bank hascommenced computation of the capital requirements foroperational risk under the Basic Indicator Approach (BIA). Also,steps have been initiated, as a part of Integrated RiskManagement Architecture (IRMA), to upgrade the existing system
http://www.idbi.com/pdf/Carbon-Magazines/IDBI-Carbon-Development-July-2012.pdfhttp://www.idbi.com/pdf/Carbon-Magazines/IDBI-Carbon-Development-July-2012.pdf


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and practices to migrate to Advanced Measurement Approach.Recognizing the importance of Business Continuity Planning (BCP)for minimizing the adverse effects of business disruption andsystem failure, IDBI Bank has put in place a Board approved broad

framework of BCP. In addition, in order to provide continued anduninterrupted customer service even during natural disasters, aDisaster Recovery Site has been installed and Disaster Recovery(DR) drill exercises are conducted periodically to test the DR Plan.

knagement:

Globalization,deregulation,andliberalization,the world over,are creatingopportunities asalso threats.

The forces

unleashed byglobalizationhave intensifiedcompetitionfrom within andoutside thecountry.


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Business unitsare thus facinga multitude ofrisks, some

familiar but alsosome quiteunfamiliar ones,and highervolatility incash flows. Thesignificantinfluence thatthese eventshave on the

financialsystem,stronglyindicates theimperative for amove towards acomprehensiveriskmanagement

system to keepin tune withvolatilities in anever changinguncertainbusinessenvironment.

This wouldenable IDBIBank to takeadvantage ofthe upside,while managingthe downside.

IDBI Bank in the


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course of itsoperations isexposed tovarious risks

like Credit Risk(mainly onaccount of theborrowers andother counter-parties inabilityto meet theirrepaymentcommitments),Market Risk

(arising out ofmovement ofmarketvalues/interestrates impactingearningpotential, fairvaluation orrealizable value

of the portfolio),Liquidity Risk(impactscapacity toraise necessaryfunds to meetdebt servicingrequirementsanddisbursements),Exchange Risk(arising frommovement ofexchange ratesof foreigncurrency) and


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OperationalRisk (includesrisks arisingfrom

operationalprocessesincludingtechnology,manpower,procedures,etc.).

Riskmanagement is

a key elementof IDBI Banksbusinessstrategy.Awareness,identification,measurement,monitoring andcontrolling risk,

efficiently andeffectively, in amanner gearedtowardsyieldingsustainedeconomicvalue, is amongthe highestpriorities of IDBIBank. Theobjective ofRiskManagement isto move IDBIBank up the


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value chain byensuringsustainedquality growth

in and off thebalance sheetitems alongwith optimizingthe bottom-linecompensationto adequatelycover thevarious risksembraced by

IDBI Bank andprovideaccretion to itscapital. In theprocess, RiskManagementaims to createvalue tangibleand intangible

for itsstakeholders(investors,customers,employees,regulators) inthe form of asuperiorbalance sheet,adequateliquidity,healthy returnon capital, trustand confidence,etc. In thisdirection, Basel-


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II guidelines,which willfacilitate up-gradation of

riskmanagementfunctions,assume acritical role.While the RiskGroup isentrusted withthe keyresponsibility in

riskmanagementfunction, inpursuit of thisenterprise-wideobjective, IDBIBank considersevery employeeof the Bank a

Risk Manager.

Credit risk:

The Credit Risk is primarily assessed as a part of appraisalprocess, which considers various parameters. Management, trackrecord of the promoters and the company, technology, overall

capacity, demand and supply scenario, competitors, industryenvironment etc are assessed to evaluate the credit risk whichwill in turn decide the level of banking facilities and the spreadchargeable (credit spread) over the bench mark interest rate.While the appraisal process assesses the Credit Risk quality,exposure limits set for individual companies, groups andindustries facilitate limiting credit risk quantity. Besides, specific


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risk mitigation covenants are incorporated in the terms andconditions of credit facilities. The risk perception also getsreflected in pricing, within the constraints of competition. Allmajor sanctions are committee based to ensure better

discussion / evaluation. Recognizing the significance of credit riskin banking operations, IDBI Bank has put in place a Credit RiskManagement Framework with appropriate risk management skillsets, which provides not only a competitive advantage in themarket place, but also positions IDBI Bank to capitalize on theopportunities for growth. IDBI Bank follows a proactive CreditPolicy, which is regularly reviewed and updated to take intoaccount the developments in the credit scenario. Best practicesare employed through appropriate credit delivery processes andportfolio & account monitoring. IDBI Bank has adopted the

Standardised Approach for credit risk as per RBI guidelines and isin the process of further upgrading and strengthening its CreditRisk Management System, to migrate to the advanced

Market risk:IDBI Bank addresses all forms of market risks, viz., liquidity risk,interest rate risk and foreign exchange risk through a well-definedset of policies and processes. Separate treatment is given tomanagement of risks in trading book and banking bookrecognising their differential impact on the balance sheet. Thetrading book risks, which are more susceptible to marketmovements, are continuously measured and managed by markingthe positions to the prevalent market rates. In order to assess thelikely impact of market movements, periodic analysis of thetrading book is carried out on the basis of positions based onchanges in market rates, past trends, stress tests through rateshocks, scenario analysis, etc. The overall positions and functionsof market risks are run under the policy framework defined inAsset-Liability Management (ALM) Policy, Market Risk Policy and

Investment Policy.

Information Technology (IT) Risk:

IDBI Bank has been in the forefront in leveraging InformationTechnology (IT) to extend better service / products to thecustomers and other stakeholders, it recognizes the need for


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effective IT risk management. Apart from Information Securityaspects, IDBI Bank's IT risk mitigation strategy includes aspects ofcompliance & privacy also. IDBI Bank has put in place anInformation Security Policy (ISP) to ensure that information is

protected from unauthorized access and confidentiality & integrityof the information are maintained along with timely availability ofIT resources to legitimate users. A high-level Information SecuritySteering Committee (ISSC) of IDBI Bank ensures that provisionsare in place for continued protection of IT resources of IDBI Bank.Apart from conducting regular information security awarenessprograms for the employees, IDBI Bank also communicates withthe customers on various Information Security precautionsthrough E-Mail / Mail / SMS.

IDBI Banks IT infrastructure and systems have been implementedwithin a robust information security framework. The centralizedData Center of IDBI Bank has been accredited with ISO 27001.Defense in depth is achieved by multi-level information securityimplementations such as Firewalls, Gateway filters, De-militarizedzone (DMZ), etc. Access to the information of IDBI Bank is onneed to know basis and internal controls & processes are inplace to achieve the same. A dedicated team monitors theinformation security infrastructure of IDBI Bank on a 24X7 basis.

Complaint about opening accounts

Complaint about loans


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IDBI Bank stands out amongst its banking sector peers

when it comes to customer care.

While IDBI Bank would not compare favorably with some of the

front line banks like PNB and HDFC Bank besides the big brothers

SBI and ICICI Bank in terms of (assets) size and reach, it can

definitely give them a run for their money when it comes to

customer service, a critical though mostly ignored aspect where

most banks falter to deliver. In fact, IDBI Bank is too good for

other banks to come even close to it when it comes to customer

care.

To cite one example, just a couple of weeks ago, one of my friends

told me that he was pleasantly surprised when he received his


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cheque book even before he could apply for the one! His earlier

cheque book had almost exhausted, however, he was too lazy to

apply in time for a new one. But the bank was not! Its robust

customer care infrastructure knew when to send the cheque book.

My friend had not expected his bank (IDBI) to be so caring!

Surprisingly, not many people know that IDBI Bank is a state-

owned (and not a private sector) bank!

And it is just one example. Even the branch banking experience at

an IDBI Bank branch would put its competitors to shame. The

ambience at IDBI Banks branches is so good that a customer may

wonder whether he or she is visiting a top quality car show room!

But the biggest surprise is the quality of staff. The staff is

courteous and caring. They are also very forthcoming and are

always ready to assist you. They also lend an ear to your

suggestions as well as grievances with equal ease. They also have

the patience to listen to their banks customers small chit-chats.

Though all this may sound unbelievable, it is true. Indeed, the top

quality customer service of IDBI Bank comes as a fresh breath of

air to customers (at least for small customers like me) tired offacing apathy of staff at majority of the home-grown banks,

including the fast-growing private sector banks.

Its a remarkable turnaround for the yesteryears DFI

(Development Financial Institution) behemoth which had been

trying hard to find its footing in Indias banking landscape that

underwent a sea change post-1991. While the sector ushered into

universal banking, IDBI found itself sorely lagging behind peerslike ICICI and HDFC, which leapt ahead by morphing themselves

into a sort of financial supermarkets, riding high on new and

innovative models such as bankassurance and universal banking,

in tune with the changing global banking environment.


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The transformation that IDBI has undergone in the last few years

is, however, now beginning to show the results. As its 2010

financial results showed, it pays to be customer-friendly.

According to an analysis by The Analyst magazine (October 2010

issue), IDBI Bank outperformed its banking sector peers (in the

state-owned banks category), by notching up highest Business

Per Employee and stood second in terms of Profit Per Employee

(after Corporation Bank), during FY 2009-10.

And if it continues its good efforts in the hitherto ignored areas

like customer care and product innovation (even its passbook

looks sleek and is elegantly designed), it would be tougher for

rivals to stop its march to the top of the banking league table.

Surely, IDBI Bank stands out as a shining example in an industry

which is notorious for poor customer service. Maybe they can take

a leaf out of the retailing industrys book - the best industry when

it comes to customer care.

Good work, IDBI Bank.

On the lighter vein, I would like to put the disclaimer that its

neither a sponsored ad nor an advertorial. Its the personal

experience of the author. Hence experiences of other customers

might vary.

Amit

CONCLUSION


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IDBI Bank is one the most popular banks in the banking sector working with a vision to keep all its

customers satisfied in every phase of life by providing all sought of benefits besides providing loans for

individuals and also for different sectors, making all its customers delighted by issuing credit cards, auto

loans, education loans etc, and dealing with the customers with all responsibilities.

While in the actual business with the IDBI bank some of the customers have faced problem suchproblems are Big and lengthy process for loans, lot of negotiation involved for the loan, lengthy process

to open an account, need lot of patience required to deposit amount, lacking in updated the customers,

customer services do not respond properly.

All your complaints can be registered at the head office of IDBI bank situated at IDBI Tower WTC

Complex Cuffe, Parade Colaba, Mumbai 400005, Maharashtra, India.

You will be delighted by calling customer care services at most customer satisfaction is taken care at

these numbers 022 66553355 and 22189111.

Home page of IDBI bank is full of required options helpful for the customer to understand the bank in

actual sense just log on to the website www. idbi.com

services failure and customer handling

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