‘Employee dissatisfaction may impact…customers with a smile’: RBI deputy governor Swaminathan J

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Reserve Bank of India deputy governor Swaminathan J has warned management of banks and other financial sectors against pushing their ‘employees to do business’ at any cost, while calling for the need of a ‘satisfying work environment’.

In his keynote address, Swaminathan stressed on the importance of a well-informed and empowered frontline staff, who according to him, can transform customer grievances into opportunities for building stronger relationships.

“After all, staff are your ambassadors – they are the face and voice that customers encounter. A less than satisfying work environment results in employee dissatisfaction which in turn may impact their ability to serve their customers with a smile”, the central bank‘s deputy governor said.

“ It may not be out of place to mention here, that the tone at the top is very important – if you push your employees to do business at any cost, it is likely that they may relegate the customers’ interests to the background”, Swaminathan added.

RBI deputy governor Swaminathan J.

Calling for customer-centric approach, Swaminathan said that the regulated financial entities should ensure that employees understand that their primary responsibility is to serve customers’ financial needs.

“There should be clear and transparent incentive structures that reward employees for delivering quality financial advice and services rather than just making sales. Staff should ensure that products are recommended based on the customer’s financial situation, goals, and risk tolerance”, he added.

“Towards this, every financial institution should have a policy for customer appropriateness and product suitability framework. By adhering to such a policy framework in letter and spirit, REs can greatly reduce the mis-selling complaints which form a substantial portion of the complaints that we get to see”, the deputy governor added.

“Regular analysis of customer feedback, complaints, and suggestions can serve as an invaluable compass in navigating toward a service-oriented future. Root cause analysis will not only allow rectification of individual grievances but also enhance systemic processes to prevent re-occurrence” Swaminathan added.

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