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ECS Fiasco: Kotak to Blame, ICICI Redeems Itself

Ravikiran Rao writes in response to the ECS post:

Just wanted to give [the story] a little more detail. The detail will indict Kotak further and probably exonerate ICICI – go ahead and update your post with this if needed.

So my ULIP with Kotak turned 3 in November 2009. I had already decided to stop paying my premium after that and keep the ULIP in autocover mode. In November, I call up their helpline and ask them how I am supposed to do that. They give me conflicting answers. Their initial tack was to say that payment cannot be stopped. But when I press them, they admit that yes, the policy *can* be moved into auto cover mode. When I ask again how to do that, they tell me that I have to give them a letter  – then they change tack to tell me that a mail to their client service email is sufficient. So I send them a mail. I get no reply except an automated acknowledgment. Then I find out that they’ve gone ahead and debited my ECS in December. I call them once again, and once again they hem and haw, and then say that I should give them a letter. I courier a letter, and they don’t acknowledge, and I learn that they’ve debited my ECS yet again. In the meantime, I get too involved in my professional and personal stuff to follow up, and I don’t do anything till February. I call them again in February and this time they tell me that it is better to actually go there and give them a letter.

I type out a letter, print it out and sign it, and go over to their office and hand deliver it. The female who took my letter tells me that she will forward it to the concerned third party who processes the ECS, but because it was a third party, sometimes there’s a communication gap and yada yada.. and it is better to go and get my ECS canceled at the bank. I don’t remember why I hadn’t tried this till then – I think I was under the impression that the bank is not allowed to unilaterally cancel the ECS. But anyway, this time I went to ICICI Bank Madhapur, and there the chap tells me that they aren’t allowed to do it without an NOC from the recipient. I took that at face value, but then again wasn’t able to follow up with Kotak – remember that by now, following up actually means driving 20 km to their office, something I wasn’t keen to do. Perhaps I just hoped that they’d manage to get their shit together and close the ECS.  Unfortunately, I had not taken an acknowledgment from them when I delivered the letter.

Then again in March, I get an SMS telling me that they’ve debited the ECS. This time, I realize that I better do something about it. On 25 March, I drove to Kotak, two copies of a stinker letter in hand.  The letter expressed shock that they had ignored my clear instructions about not taking my money, and if they failed to act on it, I was going to complain to the IRDA ombudsman. This time, I decided that I was going to get a stamp and signature from them acknowledging my letter, so that I could use it as the basis of my complaint to IRDA. I walked into a scene reminiscent of a sarkari daftar. There was no power at their office, and the entire gang was having an extended lunch break. I go, have a coffee, return and find that the lunch break is still on, and there is still  no power. I give my letter to the security guard who takes it inside. I see from the glass door that the woman who takes it reads it, then tells the guard (with no sense of urgency or concern) “Ya.. just go  get a stamp and give the acknowledgment back to him”. Then in a Kafkaesque twist, the security guard searched for 10 minutes for a stamp, but couldn’t find it.

In that time one guy deigned to finish his lunch and decided to man the reception counter. He takes a look at my letter, and tells me that as a “policy” they don’t cancel the ECS. I asked him to show the policy. He said that he couldn’t show it, but that was the policy. I told him that I needed an answer in writing. He told me to get the ECS cancelled through the bank. I told him that ICICI wanted an NOC from Kotak for that, and asked for an NOC. He said that they couldn’t give an NOC. I told him that I wanted a reply from Kotak to my letter in writing. If they refused in writing, I would take that letter and go to the IRDA. If they didn’t reply, I would still go to the IRDA. He finally deigned to give me an acknowledged copy, and told me that I could expect a reply in two working days. I took his number and told him that if I didn’t, I would call back.

It was then that I had that tweet exchange with you and learnt about the RBI circular. I decided to go to ICICI on Saturday (27th) with a copy of the circular and force them to stop the ECS. But on 26th, I get a call from the Kotak guy. It seems that he’d forwarded my letter, and was told that I was supposed to fill in a form for continuation of the policy in Auto-cover mode. He mailed me the form when I asked. The existence of this form had been completely hidden from me for 4 months by everyone at Kotak, but the threat of a complaint to the IRDA ombudsman brought it out within one day. I have yet to fill in the form and send it to them.. Will keep you posted on that.

But in the meantime, I went to a different branch of ICICI closer home yesterday. I had a printout of the RBI circular handy to show it to them if needed. But turned out that it wasn’t needed. I just told them that I needed to close the ECS, and they asked me to write out a letter. I did, and while he asked me to specify why I wanted to close the ECS (presumably because there was some mandatory text field he had to fill out) he didn’t hassle me about it. Just a “I don’t want to pay them money any more” worked. There was no mention of an NOC.

So, that’s my story so far. I think that the ICICI problem was just a case of one guy at one branch being ignorant or lazy or both, so I wouldn’t be too hard on them. Kotak, on the other hand, is just evil. They clearly have a policy of trying every trick they can to stop people from withdrawing ECS mandates. Obviously, a lot of people won’t have the time, energy or knowledge to pursue them – and how many people will know that “Do it or I will complain to the IRDA Ombudsman” are the magic words?

Amazing.

Look at the trouble he had to go to.

  • Call Kotak, who ask for a mail.
  • Send mail, get canned ack.
  • Kotak still uses ECS to take money.
  • Call Kotak again, they ask for signed letter.
  • Send signed letter by courier. No acknowledgement.
  • Kotak still uses ECS to take money.
  • Call Kotak YET again, they ask him to come to their office.
  • He goes and gives a letter in person.
  • He also asks ICICI to cancel but the banker asks for an NOC, which Ravi later realises is not required.
  • Kotak still uses ECS to take money.
  • Miffed, Ravi goes to Kotak’s office AGAIN, is lied to blatantly (“Policy of not cancelling ECS”, “Can’t give NOC”, etc.) but forces the letter through with the threat of an IRDA complaint.
  • Kotak calls and asks Ravi to fill out yet another form to move the policy to auto-cover mode, which should have been told to him on his FIRST phone call. It might be the “ACM” form on the Kotak website; but why the shoddy phone and in-person service?
  • Another branch of ICICI lets Ravi cancel the ECS with a letter/form and no NOC.

4 phone calls, 4 letters, 2 visits to Kotak, 2 visits to ICICI Banks branch, 1 more form to be couriered. For one little tiny process. (Buy all telecom/courier/oil stocks)

What happens now? Will Ravi’s ECS cancellation work? Will Kotak STILL try to use ECS next month? Will ICICI refuse that ECS? Will Kotak then try to “recover” premium from his ULIP account? Will ICICI charge “ECS return” charges, because some other system botched up?

The score till now: Ravikiran +1, ICICI Bank 0, Kotak Life –100.

I hope the story ends here.

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