Tuesday, April 15, 2014

HDFC Bank - Return to the Dark Age

I had written about my trials and tribulations with opening an account with the venerable HDFC Bank.

Have a look at their logo. How utterly wrong they are. They do not understand our world at all. Why should I speak for all of you? Actually they do not understand my world, and I am sure many of you are from my world.

It was a mistake. I should not have opened the account. I foolishly thought that having a second bank would be useful and a sensible decision. But, I was wrong.

In the one year the account was open, there were no transactions at all. All I did was deposit some money to open the account and then I placed half of that in a fixed deposit. Thereafter there were no transactions at all. None. Despite this I had to visit the branch many times to get statements issued, get Sister Stonethrowers address corrected and so on and so forth. Every visit to the branch was like visiting a Shiv Sena Shakha office. I have never been to a Shiv Sena Shakha office, but visiting the Turner Road Branch painted a vivid picture of what it would be. Everyone spoke Marathi, everyone, except the branch manager who was a Tamilian. I know this is Mumbai, I realise Maharashtrian chauvinism, but, this was a bit much.

Anyway, things got from bad to worse. Out of the blue we all received a slightly substantial envelope. This contained a letter and, believe it or not, a pass book. Pause here for a moment. Cast your mind back to the mid 1980’s and beyond. The only banks around were SBI and the other nationalised banks. Every time you had to deposit a cheque you went to the bank with a pay in slip, the cheque and the pass book. You stood at the teller and soon your passbook was updated with the magical words `Clg’ meaning clearing. Similarly, each time you wanted to withdraw Rs 500 to pay the servants salary the `self’ cheque and the pass book was sent to the bank. After the debit was made you eagerly looked at the page ensured that the debit `entry’ had been made and that the balance was indeed correct. I recall everyone doing this, and, people had been doing this for years. 

Then we suddenly had `private’ banks and everything changed. Soon the stodgy banks also changed, not without a few strikes by the Leftist Unions protesting against `computerisation’. Then came the internet wave and with that came internet banking. Everything changed. You did not have to go to the bank. Now the Mobile banking App wave is starting and you can do all your banking on a Smartphone. Is that not amazing? Honestly. All this has happened in the last 10-15 years. Today there is really no reason to actually visit a bank. You can transfer and make payments online, you can get cash from any ATM, you can have your dividends credited directly and electronically into your account and, you get your monthly or quarterly statements delivered home.

In a stunning return to the Dark Age, the venerable HDFC Bank has given me a pass book and a letter of explanation. The point made in the letter is that from April 2014 HDFC Bank will not send any statements. The passbook is what will be used. Also, if a customer wants a statement, he can access his account via net banking and print his own statements. This means that I will have to visit my branch every so often to have my damn passbook updated. I have one simple question. Why?

No sooner I got the letter and passbook I was enraged and frothing at the mouth. I rushed off to the branch and vented my spleen at the fools. Then I asked the Shakha Pramukh what this was all about. He, foolishly said it was a RBI Mandate, to fob me off. I checked the RBI website which clearly said that at the customer’s request a bank was obliged to provide a passbook and not otherwise. So this RBI mandate is total rubbish. I must clarify that this was told to me by the Shakha Pramukh and is not contained in the letter.

The letter says that the bank will now not provide printed statements that are posted to your address consequent to (i) a request by account holders and (ii) as a `green initiative’.

On (i) I have no knowledge. However, it seems farfetched that customers who get statements at home/office would suddenly find that so inconvenient that they would want to return to the dark ages. Who knows, it may even be true. One has to keep peons and drivers busy these days. Send them to the bank every time you issue a cheque to update the passbook. Gainfully employed, and in the interests of transparency your domestics will know exactly how much money you have. Excellent, you can rest assured they will either rob you if you have a lot, or never ask you for a loan if you have no money. `Ekdum changla, no’?

How does the `green initiative’ argument work? Your Chartered Accountant would want a statement when filing returns, when applying for visa’s you need to provide statements; every stupid KYC requires a proof of address which is your bank statement? All that the `green initiative’ argument is, is that the Bank will save lakhs on printing and postage. The job of printing has to be done by you. So how is this furthering the `green initiative’ argument? I am at a total loss. All that the bank is doing is increasing its bottom line to your detriment and being deceitful about it.

Bottom line folks. I have shut the accounts. Considered the whole exercise as foolishness on my part. I am back to having just one bank as my banker.


  1. I have a bit of a different view on the passbook system than yours though I agree with you that they do not understand anybody's world. About 2 years back I voluntarily made a request for a passbook for the numerous accounts that my family members have. There was good reason for that. I wanted to cut down on the visits by couriers to deliver the statements which would be numerous in a month since the statements for each account wouldt be monthly and there would also be a consolidated statement as well. Please note that this bank does not follow a calendar month for issuing a statement but the month begins from the date you open the account. My plan failed. The courier visits did not stop. I was left holding a passbook and monthly statements. Now I have been assured that there would be no more monthly statements which means no more files to maintain. Everything gets printed in a small book that can be updated once in six months. For the net savvy, this bank offers you historical statements for every financial year for upto the previous 5 years. I download for each year and email it to my accountant who is happy to receive it in PDF form. The passbook is also a far more acceptable form for proof of address and other KYC requirements than a computer generated statement that needs no signature. Get your banker to put a rubber stamp on the first page and it is good as gold.

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