In a startling revelation, banks across India are facing accusations of unauthorized deductions from customers’ accounts to enroll them in low-cost life-insurance and accident-insurance schemes launched by Prime Minister Narendra Modi’s government. Despite media exposés and public complaints, the malpractice continues unabated, with some banks resorting to forging customer consent and employing deceptive tactics to meet government-set targets.
The modus operandi involves what is termed as “bulk activation,” where banks upload and approve numerous customers’ details into the insurance-activation portal en masse, without their knowledge or consent. This method allows banks to meet targets swiftly but raises serious ethical and legal concerns regarding customer privacy and financial integrity.
Instances of unauthorized deductions and forced enrollments have surfaced across various regions, highlighting the institutionalization of malpractices at regional, zonal, and even head offices. Despite the blatant violation of customer rights, banks have allegedly turned a blind eye to complaints and sought to conceal their fraudulent activities.
One such case involves engineering graduate Kundan Kumar, whose bank deducted money from his account and enrolled him in the government’s life insurance scheme without his consent. Despite his efforts to unsubscribe and seek a refund, Kumar’s bank failed to provide satisfactory resolution, leaving him disillusioned with the banking system.
Similar incidents have been reported in other banks, where customers have been illegally enrolled in government schemes without their knowledge or consent. Despite protests from branch managers and customer complaints, regional and zonal offices have allegedly orchestrated bulk activations, disregarding ethical and legal considerations.
The revelations have sparked outrage and raised questions about the accountability of banking institutions and regulatory oversight. The exploitation of customer trust for meeting government targets undermines the principles of transparency and integrity in the banking sector, calling for urgent intervention and corrective measures.
As customers grapple with unauthorized deductions and deceptive practices, there is a pressing need for increased scrutiny and accountability within the banking industry. Regulatory bodies must take decisive action to curb malpractices and ensure the protection of customer rights and interests.
In the face of mounting evidence and public outcry, banks must prioritize ethical conduct and uphold the trust placed in them by customers. Transparency, accountability, and adherence to regulatory standards are essential to restore confidence and integrity in the banking system, safeguarding the interests of all stakeholders involved.
