Banking Central | A humble request to banks: Don't spoil my New Year with cold calls

Dear friend, please understand that I do not require that personal loan, neither that all-in-one credit card. If I needed one, I could have walked into a branch or login to the mobile app right away.

I would love to tell you the story from my end. Here's how it works...

On a normal day, anything around 10 calls land on my phone from various non-bank financiers and loan apps dishing out personal loan offers with lightening-fast sanctioning process. The number trebles or quadruples if, by mistake or because of simple curiosity, you hit an ad on any website. It sets off an alarm bell at the call centres and throws open floodgates of marketing calls. Bombardments by text messages through SMS and WhatsApp continue in parallel.

The loans on the offer require very little or no documentation at all. Casual inquiries show that most such calls originate from third-party call centres at a faraway place. Disgusted, if you block or blacklist one number, the next moment another number pops up on your screen.

It’s quite a task to convince the caller that I don’t need a loan. The desperate agent from the other end goes on to ask why so, making me feel so stupid to set aside such a lucrative, once-in-a-lifetime offer. The callers are persistent and trained to be completely insensitive to the inconvenience they cause.

There's no respite in sight, but the only solace is, I'm not the only one.

It doesn't matter whether you are salaried or you run a business, you are a prey as long as you have an active bank account. They don't go into a slumber on the work days, in the weekends,  they are often more bullish because you are relatively relaxed or easier to be reached.

As the harassment continues unabated without any sign of the relent, I wonder where has data privacy gone. How do these callers get my personal details? Opting for a 'do not disturb' option helps little.

I find that most callers are equipped with the basic information about their targets such as name, city of residence, and primary contact number. But, mind you, I never shared these details directly or gave my consent to my bank to share them with these callers. That means they sourced it from someone with whom I willingly shared the details.

The process of sourcing my data could be either through illegal means or by way of a clandestine understanding, say, by paying for such personal details.

This is clearly not acceptable, by no means.

In this age of digital revolution, there's always a scapegoat, if you question such unscrupulous behaviour. Like all other service providers, the banks blame it on third parties.

But, what are these third parties? Banks typically outsource call centre activities to companies outside its periphery to breach the RBI rule that restricts the time and manner in which the customers can be contacted over phone.

These call centres have targets to reach out to a certain number of customers every day which explains the endless calls we are forced to endure.

That's not all. We're constantly under watch. Our every financial activity on the phone in observed, it seems. Even if you randomly look for loan rates and offers on the internet, the call centres are alerted about a prospective prey. It triggers a flurry of calls, asking when you would like to draw the loan, and coaxing you to go for it even if you don't need it. Their desperation is evident as their calls keep beeping on your phone when they find you busy on another call.

What about the data you and I share on social media platforms and merchant outlets? These details are also at risk of being leaked to the third-party apps by hackers who use it for loan canvassing. In the absence of strict laws to get them to books, this has become a ominous truth we seem to be destined to live with.

And, if you bite the bait, you're in for a rough ride. These easy loans come with hefty interests and the calls are replaced by a flood of text messages they start sending out to you several days before your payment deadline, almost driving you to foreclose the loan to stop the phone from whirring.

Then come the worst part of harassment. In case you fail to meet the deadline, you are set for a trip to hell. They would malign you in all possible ways that you can't even imagine. We have seen many cases of suicide over harassment for defaulting on loans sold in a haste by banks without adequate transparency to the borrower.

Clearly, ethical lending institutions must stop making such cold calls multiple times a day and push lower-level executives to sell loans to customers even when they do not need it or investment products that they don’t understand.

It is not that the government and the regulator are unaware of the problem.

The Reserve Bank of India has repeatedly cautioned the financial entities it regulates to pay attention to the problem of data theft. Top RBI executives have reminded banks that as custodians of vast volumes of sensitive customer data, banks must make the required efforts to adhere to the provisions of the Act and related regulations.

The good thing is that India is finally getting a Data Protection Bill ready. The proposed draft Bill provides for the processing of digital personal data in a manner that recognises the right of individuals to protect their personal data.

As per the rules, entities will be able to use and process personal data only if individuals have given their consent to consent managers which will be entities entrusted to manage records of consents of people.  The rules are not in place yet.

Well, do we see an end to the harassment once the rules are in place?

The law won’t make much of a difference without a seamless execution. It is up to the banks and other financial institutions to make sure that personal data collected at their counters is protected. In fact, more than forced by the regulations or a national Act, lending institutions should take this up as a duty and self-regulate in the interest of their customers. Now, that’s a call the bank managements must take and the Boards must enforce. Till then, any respite from the tele-callers looks a far cry.

My phone beeps again... "Hello sir... I have the best personal loan offer for you... How much do you need?"

Dear banker, please understand that making endless calls back-to-back during the day and even on the weekends don’t change the fact that I don’t need that product. I understand that this is a well proven strategy to turn the potential customer to a real one with repeated calls.  But please do spare me that luxury!

Please consider this my New Year Wish from you!

Banking Central is a weekly column that keeps a close watch and connects the dots about the sector's most important events for readers.

(Editor’s note: This is an updated version of an earlier BC column published on February 26, 2024)