Jagoinvestor
February 28, 2010
Real Story about an Investor who Fought for 9 months with ICICI Bank
Can you fight back ? Really ? If you were taken for granted as a customer by some Bank or any institution and you were forcibly sold some product by officials at some Organisation assuming you are a weak customer who will not raise his voice and fall in trap , What would you do ? Will you have the guts and energy for fighting back and getting what you deserve ? Here is a real life Story directly from the customer who faced lot of problems from his Bank when He wanted to shift his Home loan from One city to another . Lets see in this article in his own words and find out how Officials in these big banks take advantage of customers situation to make money for them selves . See other Force Selling Examples
How it all started
I have two home loans, one in Delhi and other one in Pune and I wanted to go for a home loan ROI switch (conversion of higher rate of interest to an existing rate of interest). My prevailing ROI was very high for both the home loans so wanted to reduce the ROI, of both, by paying the processing fees. ICICI bank has a process where-in one can go for ROI switch by paying the processing fee. First, I went to the Pune office, as I am in Pune, in March 2009 and then visited the Delhi ICICI branch in May 2009 for the loan switch.
- March, 2009 : ICICI Bank, Shivaji Nagar, Pune – The officials asked me to buy a ULIP of 40K for the conversion. They changed my loan account number and took all the documents again as if I am applying for a fresh loan. They also took 1 month to process my loan switch.
- May, 2009 : ICICI Delhi – The customer care executive asked me fill an agreement on a 50 rupee stamp paper, took the switch fee and all the formalities were done in record 80 minutes. He did not ask me for any other paper and my loan ROI was switched in 2 working days.
Read the process in detail here.
The ugly truth
ICICI Pune branch has forced me to buy a ULIP and took 1 month for the switch procedure where as Delhi has taken 80 minutes. ICICI home finance Pune in collaboration with ICICI Pru is duping customers. ICICI Pru people are simply forcing their policies on ignorant home loan customers. This is how ICICI Pru executives are achieving their monthly targets.
Just imagine if I would have only one housing loan and that too in Pune, I would have been blissfully unaware of this racket. They must have done it with many home loan customers in Pune.c
The Confrontation
I sent my first complaint letter to ICICI Pune, heard nothing for weeks. Sent many letters to all the 3 level of escalation as described on ICICI website, still no response. Finally, I complained the banking ombudsman (See How to complain to Banking Ombudsman) View the full complaint timeline Below .
The Result
Due to the Ombudsman intervention I got my 40K ULIP premium back, but ICICI evaded the answers of my other questions and no action was taken against the two officers involved. I realized that ICICI is capable of dragging this to eternity so I created this blog and uploaded all the conversation which I had/ was having with ICICI. My blog created a lot of noise and after 9+ months few senior folks from ICICI finally decided to extend the support. Finally my queries were answered and Interest loss was credited back in my savings account. I was happy to find the answers but also sad as it took 9+ months for ICICI to respond. I have sent a letter of appreciation to ICICI in the same regard.
The Lesson Learned
- Never trust any bank official as they have hidden agendas behind their suggestions and make it a point to read all the documents carefully.
- Never do something which is being pushed upon, always take your time. Remember if they are rushing you and want everything today, take your sweet time and do a research.
How to avoid such scenarios
If you have been asked to buy a ULIP for any loan related process, use any of the method below to get back your money.
Option 1 :
Resolution Duration : 9+ months
Pain, mental trauma, stress and harassment : High
- Send ICICI a complaint mail with all the relevant docs photocopy (I maintained the correspondence on a blog which served dual purpose)
- Send a mail to all the three level of escalations mentioned at ICICI website – this is just a formality as u need to give a proof of ur complaint before sending a mail to Banking Ombudsman. dont expect anything from ICICI as it is a sheer waste of time but you have to do it.
- Now send a mail to ICICI ombudsman with all complaint letter attached. Make sure you provide the complaint in the desired format.
- Send a mail to ICICI Pru Bombay, thru post and online, the ICICI Pru is very fast in resolving any dispute.
- Keep sending stinker mails to ICICI, well they not budge but you will feel good and light
Summary : Online blog will help u maintain the flow of sequence and the best part is that u will learn how to blog :-). Keep on following and one day someone will respond, in my case it took them 9+ months…..
Option 2:
Resolution Duration : 15 days to 1 month max
Pain, mental trauma, stress and harassment : NIL
- Go to the bank and agree to buy the ULIP in return of you loan related process.
- Give them ULIP premium cheque, get a photocopy of the ULIP docs/forms and the check.
- Take the visiting card of all the people who were involved in ur case (this is very important, if no visiting card atleast take their name, designation and mobile no.)
- Ater u have agreed to their demand of ULIP now make sure you get ur work done ASAP. Don’t give them any time get ur work done at the earlier. Be firm and be rude.
- Wait for the ULIP welcome kit
- Once you receive ur ULIP welcome kit, write a strong complaint letter to ICICI Pru telling them about the forced ULIP, the names of the people involved and your request of cancelling the ULIP. In all the insurance firms there is a freelook period of 15 days to 1 month during which u can refund the policy without providing any reason (but you must cite your reason in this case).
- Make sure your complaint mail is very strong. ICICI don’t respond to polite mails, they simply ignore them.
- Your ULIP money will be refunded.
Summary : This is a very simple way of getting ur work done smartly by complying to all the stupid rules set by ICICI or any other bank for that matters. Just agree to their demands and cancel the ULIP during the free look period.
Good luck and have a safe banking .
How Much Home Loan can you afford (please vote , Data will be used for future Article)
Comments , What do you think can be done to avoid these situations ? Are you aware of any thing like this in your real life ? Lets share our views on what are the different preventive and corrective measures which can be taken to avoid these kind of situation . Dont forget to praise the efforts made by this Guest 🙂
Note : Though utmost care has been taken while taking the information , Jagoinvestor do not take any responsibility about the information provided above.
Hello all,
The loan amount has been disbursed to the seller’s account from SBI but while they were taking my sign on loan agreement , they said Property insurance is mandatory and gave me a form to fill but I said if it mandatory I will have check from different organisation and give the insurance in 1 month.
Can any pls let me know is this mandatory to have property/home insurance . Though the premium was less than 1900 rupees
Hi Viral
Yes, property insurance is mandatory from SBI ..
I have taken policy of ICICI PRU Life named HEALTH SAVER. I got to know that if I could not show the medicine bills then I could not get my investing amount which is invested in ulip. I also did not get any documents from the company from where I can know about the policy features. When I contacted to Customer Care he told me that policy documents were received by my wife. But the dates which are mentioning me about documents received , my wife was not there. Now tell me what to do get back the documents and to cancel the policy.
All you should do now is complain to IRDA on this .
Every time you go to ICICI bank for making and FD, either the concerned employee will pester you to buy a ULIP or a ICICI Life Insurance man sitting there will do so. They won’t make an FD easily, unless you take a ULIP policy, extolling the benefits of taking a ULIP for higher returns. I am stuck in a similar situation , having being forced to take a ULIP policy of 1 lakh premium (5 time option),which I was reluctant to do so, and that too for 10 years (Super Pinnacle), with the ‘promise’ by the ICICI ‘agent’ employee that I will get a return of 15% in 5 years ,when I can redeem it. This return of 15% in 5 years, I find after a research of 2 months is totally baseless. I don’t know how to get out of the policy, or at least get it converted to one time. Can they do unfair trade practise of posting an Insurance person, who is hand in glove with the bank officials?
Vinay
Its purely an agent issue , i mean bank is not involved in this , but bank officials might be, I wonder why you never took the route of complaining to ICICI about it , there is no reason to buy it from them just because they are forcing it .
Hi Manish,
I want to write a guest post on your blog. Here is a brief of the topic.
I had taken a home loan(30 lacs) from Bank A. One time payment for life insurance (for the diminishing loan amount -around 80k) was included along with the loan.
After one year i transferred the loan to Bank B (including a new insurance). Cleared Bank A’s outstanding including the insurance cost. Then I got pretty busy for next 8-9 month’s setting up the new home. Then one day when i was flipping through the old documents i realized the insurance document had an option(in very fine print) to get back a part of the premium paid in case i’m pre-closing the loan. However on contacting the Bank A & their insurance arm, they flatly refused having any such option and tossed me back and forth between the bank and the their own insurance arm. I fought with them for a bitter battle for 2 month’s. Then they agreed to give me back close to 35k 🙂
Not bad, isn’t it ?? to get back 35k of my own money just because i read the fine print in one of the documents which i should have read at the beginning.
Do you think we can have a guest post on this topic ?
Regards
Raja
Raja
Definately , its a good example and a case . You can actually make the article as general topic about “Reading the guideline and fine print” and then add your example to add value to it . This would be a better way 🙂 . What do you say ?
Mail me
Manish
Excellent suggestion. I’ll do it that way and send you the article in a week or so.
I am facing one issue with receiving notification on follow up on comment even after clicking the option (checkbox) to notify. Can you please check if it’s a generic problem.
Regards
Raja
Raja
I am not sure why its happening , so you mean that you are not getting the follow up comments in your mail box even if you have subscribed .
I will wait for your mail
Manish
m being by sbi to buy a ULIP of 50 k to sanction a home loan worth 20l..plus a FD of 1 lac..
dont want to do…as it offers the lowest ROI…
Mail them for explaination of rules and cc to IRDA and also RBI . See what happens
Manish
it is inspiring to know the way our friend fought back, here is another example of forced selling by a chit fund organisation in south. SHRIRAM CHITS PVT LTD A SISTER CONCERN OF SHRIRAM LIFE INSURANCE they both run in the SAME OFFICE AND SAME TABLE.
When we are due to get a chit amount cheq which we save for a long time like 25months or 50 months shriram chits employee or agent will ask you or force you to take a ULIP OF SHRIRAM LIFE INSURANCE WITHOUT EVEN PROVIDING THE DETAILS OF THE POLICY IF you dont buy this then YOU WILL GET YOUR CHIT AMOUNT AS LATELY AS THEY CAN.
THIS PRACTICE SHOULD BE STOPPED AND EACH ENTITY SHOULD HAVE THEIR OWN OFFICES SO THAT PEOPLE ARE NOT FORCED OR CONFUSED.
@ Manish
Thats not difficult Manish.Every bank has a specific format of email ids.Just ask any employee and you will get to know the format.
I know because i am an ex employee of HDFC Bank…………………………………………….
hi
I had a really tough time with them regarding my demat a/c. Due to some SEBI ruling , they simply locked out my demat a/c claiming that the PAN details were not submitted. After 2 years of runnning around and submitting umpteen proofs most of which used to get rejected for stupid reasons , I was finally able to get my demat a/c unlocked. I escalated this issue directly to Mr Kamath and although some senior officials contacted me , nothing happened and it still took more than a year after that to resolve the issue. ICICI service really sucks.
Thanks
RR
Nice to get your comment . Would be interested in knowing how you got senior officials email id’s and especially Mr. Kamath id ?
Manish
Deepak
I would agree with you , I ersonally applied for personal loan and zooooom .. 2 calls same day from HDFC and Citibank , where as i can see that there is lesser interest rate provided by Bank of India ..
Manish
Inspiring story!!
Through my experiences with private and public banks (SBI, CBI), I strongly think that it is always worth to take loans from nationalised banks and one should always try to avoid private banks. Initially, you may be impressed with the super fast loan processing but once the loan is processed then private banks are much worse (through the experiences of my friends). I also got my housing loan sanctioned in less than 1 hr by HDFC, paid the processing fees of 5000 also but eventually I went with CBI for my housing loan. I had to really do lot of leg work for almost 3-4 weeks in getting the loan approved but I strongly feel that it was worth the effort. Lot of the ppl I know have the mis perceptions about the way these nationalized banks function. I always advise every body to at least check out the rates, schemes offered by nationalized banks before going ahead with the private banks for loans. It is just that private banks score A+ when it comes to market their products. Even when it comes to online banking I think SBI is way ahead than most of the private banks when it comes to security, usability and user friendly features.
-Deepak
Which is the best bank in India to do business with?
Best in terms of customer service.
No data like this we have ..
I like Corporation Bank in that way
manish
Dr Kishan, i fully agree with you that now-a-days we must be careful and stop putting our trust in others hands. But sometimes these difficulties become blessing in disguise, its just that we don’t see them initially cause we are frustrated and angry at that moment.
Let me share an real life example. I bought this Pune house by becoming really frustrated with my landlord as never he let me live with privacy and devotedly increases the rent after every 11 months. On top of it the ever booming (or bubbling) property market was making me so insecure.
I got pissed off and bought this house in 2004 and when i look back now i have no regrets. The prices have risen so much that I cant even afford my current flat and i actually sent my landlord some flowers an chocolate for his unintentional help. 🙂
So the moral is no matter how smart you are, there is still too much to learn and we are bound to make mistakes.
By the way there is a saying that the smart people often make the worst decision.
– ICICI Duped me
reading this whole ordeal what i can summarize is that for every issue and situation we should have a good amount of suspicion. we should always counterquestion all the information available and check with multiple sources. in a time of excess corruption which in turn arises from greed we have to become overconcious in any matter be it wealth or health or any thing else. platforms like urs are really good in speading the information to all the general public bcoz such things will spread like fire. i am sure that eventhough icici may not suspend that executive, he shall lose his job in due course of time since his misconduct will be known slowly. all institutes have some bad elements which make the whole name bad. i too have had an “ok” experience with ICICI till now; but after reading this article i shall be more cautious now. nice fight by “icicidupedme” and nice effort by you manish
kishan
Kishan
“we should have a good amount of suspicion.” .. I agree to that , Not that we should not believe them and question the integrity , but from our side we should always have some suspicion to make sure that all our questions are answered in the start only .
I am sure if the product seller is genuine .. they will not mind the 100 questions in the start 🙂 . better to be safe than sorry .
manish
Manish,
With respect to your query, most probably myself would have followed the path of your guest. I think sometimes keeping patience give good result, only thing one should be sure of what is right. Several times my patience helped me. By becoming impatience the bp goes up and may get into more troubles. Look up the judicial process, even though you are at the right side it take a lot of time to get the verdict.
It is so happen that the fine prints of the contracts are so elaborate and not in simple language. I am sure most of us will never read it fully before singing. We do not have that much patience. Most of the banks has displayed their processing time in the banks for normal dealings. Never mind this are only indicative and not for making your bp up if the time laps.
To get rid of most of the problem one has to understand what rule says, read the postings such as yours, Subramoney’s etc.. Be an informed person before going for the sign. It will definitely will give you patience for the final kill.
Krishna Kumar
Yes , consumer knowledge and proactive action is what can save him from the trouble later. I think if a person takes care of all the small details while buynig the product and has some patience to fight back if things go wrong , the whole process will be smooth .
thanks for your views .
manish
Thank you Manish for putting my ordeal with ICICI on your blog. I hope it will educate people about the ugly truth and they will be more careful while dealing with ICICI.
In short I would like to say ” please be rude, to the point, ask for written proofs and don’t trust them under any circumstances “.
During these 9+ months i have interacted with many senior ICICI officials so I am more than happy to answer reader’s specific queries.
A special note for those who are commenting in favour of ICICI or are from ICICI. Please read the full blog before passing any judgement. Do not comment just for the sake of it. Right now ICICI is busted so if you have some strong and valid point(s), i invite you to comment with your full credentials and not as “anonymous” or under some fake name.
http://icicidupedme.blogspot.com/
ICICIDupedme
” please be rude, to the point, ask for written proofs and don’t trust them under any circumstances “.
To a point , this really applies to the banking + insurance sector these days . Agents + Officials are so careless and take customers for granted that it becomes necessary to raise your voice .
manish
My suggestion to everyone who have taken Home Loan from ICICI Bank, please go & check your original papers.
I have seen many of them in dustbin.
Hemant
I am confused . you mean they dont take care of documents and somehow it goes to dustbin , or after reading , the rules are so pathetic that they just throw it 🙂
Manish
They just don’t care, I don’t know why.
Few years back one of my friend was working for them, he shared this.
Hemant
Err .. i am confused yet
“I have seen many of them in dustbin.” . I thought you mean that customers who buy policies they dont take care of documents and it somehow ends at dustbin (care less behaviour) ..
OR
Does it happen that they look at documents and the policy rules are so idiotic that they are pissed off and throw them at dustbin .
Manish
@Jagoinvestor
I am talking about Original Home ownership papers(registries, lease documents etc) after disbursement of loan.
Careless (carefree) behaviour of ICICI employees.
Ok
got it 🙂
manish
Manish,
I think, it’s time you can have a separate section in your website for such complaints/comments. So that readers can gain from collective wisdom..
These seem to be never ending issues…
Puneet
Will do it sometime in future. . for now the comment sections look a good place 🙂
manish
Long time back citibank had cancelled my credit card without my knowledge and without any initimation/approval.
It took me almost 1 year to win the case.
RBI asked citibank to pay a penality of Rs 1000 and citibank did pay Rs 1000.
But it took me lots of follow-up – couriers, phone-calls etc.
I still have all communication mails with me.
The issue is not every customer gets up and fights. If there are many people coming forward to fight against wrongs done against them then number of such incidents will come down.
-Praveen
Praveen
What was the reason Citibank gave for cancelling your CC ?
the problem is that at the end people start feeling demotivated and dont see value in fighting .. even in your case .. 1000 was not worth .. you should have demanded more compensation 🙂
Manish
Manish,
They mentioned that I expressed dissatisfaction with their service during one of queries to their customer-care and so they closed their card without even letting me know.
I did not fight the case for claiming damanges but rather to prove a lesson to them.
Though I had called RBI that Rs 10000 was what I had originally mentioned in my complaint and Rs 1000 was less, to which I was told that I can appeal asking for higher compensation.
But that is going to some more follow-up and work.
Since I was not worried about money but rather about proving them wrong and teaching a lesson (they were arrogant) and not to take the consumers for granted,
I was contended with the results.
Consumer rights awareness is very low among Indian public.
Most of the rules/laws also put the onus on consumers rather than the banks/institutions.
Look at most of the “Terms&Conditions” of using online bank account or mutual funds etc.
Any loss due to a third person hacking or anything other issue is responsibility of customer and bank has no obligation or anything at all.
Everything is put on customer’s head.
Many a times I have not avoid internet-PIN after reading the SCARY “Terms and conditions”.
-Praveen
Praveen
thanks for sharing your story 🙂 . Its really unproffessional to treat customers this way .
Manish
Manish,
What is important is that consumers should pull their socks and fight for their rights. Most of them are just worried up spending time to fight the issue.
Once a reasonable section of them pull their socks and fight such incidents will come down.
But another equally important thing is the customer education.
Most of the customers dont read “Terms and conditions” properly.
They dont demand complete information between signing up for products.
Consumers are partly to blame for issues that arise from customer blindly signging the form and then expect RBI to take up the case for them.
So its equally important that consumers read the letter, rules, terms&conditions before signing for any product – be it savings account/deposit/insurance/funds/investements/credit-cards etc etc.
They have to figure from the bank what is the annual rate, default rate, renewal rate etc..
They should demand the agent to provide written brochure or information on the rates they are mentioning. Otherwise dont sign up for the product.
-Praveen
Praveen
[ Most of the customers dont read “Terms and conditions” properly. ]
yes , this is extremmelly worrisome . this is from where the problem starts . This is a point where most of the problems could would have been taken care but people dont feel its importance . Just to save some minutes or hours they end up fighting or managing things for months and years .
It has to change. .
thanks for your inputs .
manish
Being aware of rules helps to some extent but if the person is in need and the other party stick to the demand then you have got to pay for that. So the role of the regulator is very important. He should act fast and be effective.
For example after fighting for one year the CITI was penalized for Rs 1000. The complainant already incurred more than 1000Rs and much more precious time. Now if the fine would have some 1,00,000 and incremental for such issue, then everyone would have noticed. The rule and violations should be deterrent and impetus. If I am fined like this I will break the rule again and again.
Check US, rules are simple but violations are costly. If you break traffic rules for few times, you loose some 5000 USD which could be more than you salary there. For example if we put panelty of 1000Rs for read light break, 5000Rs for wrong format of Number plate, some 2000Rs for no helmat, and if someone is charged for that or they go to jail/do community service, then you can see people changing (even bribing traffic police will screw you up if he sticks to 50% of the fine). Everyone will fall in line even with 10% of the enforcement of law. Then you might never be caught on the wrong side.
So here in India, there is no incentive to provide good customer care during the whole process of sale – pre, in and later post. All the govt agencies are party to the crime as they have vested interests in not to change the rule.
Regards,
Anoop
Anoop
Agreed … Corruption is inside the financial institutions too .. Not sure how this will come down in long run , but customer awareness is critical 🙂
Manish
The only way we can avoid all this is by being aware of the rules. For a home loan ROI switch , a ULIP is not needed.One should ask that in the first place. When you are aware and start questioning them, agents will not dare to do all this.And to make them realise their mistakes, when any ICICI guy calls u offering home loan, tell him that you were about to take a loan from ICICI but changed your mind after having a look at the consumer complaints forum.
Swathi
yes , looks good idea .. one has to be aware of the rules and then be courageous enough to fight back 🙂
manish
My friend was asked to buy a Rs.80,000 LIC ULIP policy to get his Home Loan approved from Corporaion Bank in Bangalore. Poor fellow, had no option but to buy it.
Puneet
Ask him to complain yet to banking Ombudsman and show them this article , I am sure the officials would have a good answer 🙂
manish