IFSCA issued a consultation paper on “Complaint Handling and Grievance Redressal” on August 30, 2024, with the objective of seeking comments from the public and other stakeholders on the draft regulatory framework for complaint handling and grievance redressal by the entities regulated by IFSCA.
The proposed framework aims to establish a clear mechanism for regulated entities within the IFSC to address consumer complaints, ensuring the protection of financial consumers’ interests.
The International Association of Insurance Supervisors (IAIS) aims to ensure effective and consistent global supervision of the insurance sector to create fair, safe, and stable insurance markets for policyholder protection and contribute to global financial stability. A key objective of the IAIS is policyholder protection, guided by the Insurance Core Principles (ICPs). Specifically, ICP 19 on Conduct of Business advises that supervisors should mandate insurers and intermediaries to address complaints in a timely and fair manner.
The proposed regulatory framework for “Grievance Redressal and Complaint Handling” by the IFSCA aims to enhance consumer protection, promote investor confidence, and maintain market integrity in the IFSC. Currently, while certain requirements for grievance redressal are specified for specific services like banking and insurance, these norms vary across different financial services. The proposal seeks to establish comprehensive and uniform norms for all regulated entities to streamline grievance handling and promote consistency across various financial services. This approach aligns with the existing uniformity in KYC, AML, and CFT norms, facilitating easier business operations for entities with multiple licenses or authorizations within the IFSC.
Salient Features of the Proposed Framework:
1. Applicable to all IFSCA-regulated entities dealing with non-group consumers, except certain entities like foreign universities and specific financial services.
2. Entities shall have a board-approved policy for complaint handling and grievance redressal. The policy should ensure fair, transparent, and timely resolution, considering the entity’s business nature and scale.
3. Regulated entities dealing with retail consumers shall have a board-approved policy for handling complaints and grievance redressal, aligned with specific norms outlined in the circular. Upon receiving a complaint, the Complaint Redressal Officer (CRO) shall assess and acknowledge it within 2 days if accepted or notify the complainant with reasons within 5 days if not. Complaints should be processed fairly and resolved within 15 to 30 days. If a complaint is rejected, reasons shall be provided in writing. Additionally, dissatisfied complainants can appeal to a designated Complaint Redressal Appellate Officer (CRAO), who shall address the appeal within 30 days.
4. The Complaint Handling and Grievance Redressal policy shall be prominently displayed on the entity’s website, including contact details for relevant officers if dealing with retail consumers.
5. Regulated entities shall maintain comprehensive records of complaint handling, including details of complaints received, correspondence, documents reviewed, outcomes, rejection reasons, processing timelines, and overall complaint data. These records shall be kept electronically for at least six years or longer if specified by regulations or in the case of pending litigation.
6. Regulated entities shall submit complaint handling reports as specified by the Authority and include a “Complaint Handling and Grievance Redressal” section in their Annual Report, if applicable, detailing all complaints received, resolved, rejected, and pending for the year in a tabular or graphical format.
7. A regulated entity may opt to develop an online complaint management system based on its business’s nature, scale, complexity, and organizational size.
8. The Compliance Officer of a regulated entity is responsible for managing and resolving complaints in line with IFSCA’s regulatory requirements, while other officials’ responsibilities for grievance redressal, as specified in relevant regulations, also remain in effect.
Comments and suggestions on the proposed regulatory framework for Complaint Handling and Grievance Redressal are invited from the public and stakeholders.
The entities may send their feedback via email to Shri Akash Boddeda at akash.boddeda@ifsca.gov.in , with a copy to Shri Arjun Prasad ( arjun.pd@ifsca.gov.in ) and Shri Manan Kataria ( manan.kataria@govcontractor.in ), using the subject line “Comments on draft circular on Complaint Handling and Grievance Redressal” by September 20, 2024 in the following format:
Name and Designation
Contact No. and Email address
Name of Organisation
S. No
Clause No.
Text of the Clause
Comments/ Suggestions/ Suggested modifications
Detailed Rationale
A copy of the paper is attached for your ready reference.
Source category: IFSC Insurance Office
Attachments
- /2024/425_2024_08_30_-_IFSCA_Consultation_Paper_on_Complaint_Handling_and_Grievance_Redressal.pdf
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