Plight of Online Banking in India

So India is moving ahead. Industry is growing, common facilities are improving, conditions for living are improving (or so it seems from a middle class guy’s eyes). Banks are becoming more accessible, and easier to use. All banks now have online banking facility, and makes it less of a hassle to transact - now you can sit at home and pay your bills, buy things, transfer money to friends or parents, etc. But, after using online banking for about 4 years, I feel there is a lot still to be achieved. I find it’s not ‘very very’ convenient. Online banking experience can be made much much better by fixing these issues. Below I’m writing about my experiences with some of the Indian banks I’ve done online banking with.

State Bank of India

Hands down India’s largest bank. But the user interface of the online website haven’t changed much in the last 4 years I’ve seen. There are quite a few problems with the way the site behaves.

Immediate transfer

The rules of beneficiary addition, and money transfer are outdated. You can’t transfer any amount within the first 24 hours of beneficiary addition. It’s Painful that you cannot add a beneficiary immediately. Beneficiary addition and approval can take upto 24 hours, and I’ve seen it taking 4+ hours all the time. If you want to transfer money immediately, you’re out of luck!

IMPS is not really ‘Immediate’

IMPS was introduced as a faster ‘NEFT’ – to work around the limitation that NEFT transfer cannot be done outside bank working hours, so that you can transact round the clock. Frustratingly, SBI’s IMPS works only till 8PM. You cannot transfer money after 8PM!

If that was not all, beneficiary addition is separate for NEFT and IMPS. So you have to add your friend/relative’s account number ‘twice’ to be able to do both types of transactions.

Also, you need to remember two passwords - one your online banking password, and another, the ‘profile’ password, where you can change your profile settings. I don’t know who came up with this idea of two passwords (both requiring a special character, and a capital, and a digit, sigh) thinking it might ‘enhance’ security. Who cares about users anyway, right?


This bank recently completely refurbished its UI, and it’s pretty good compared to the old one. I was pretty impressed that a bank is really putting efforts into improving the user experience, and not just introducing online banking because all have it, and just be done with it. Only problem is, it thinks I’m dumb, and wants to force it’s own unreasonable ‘secure’ policies on me.

ICICI debit card has alphabet-digit combinations at the back. For example A=23,B=01,C=81 upto P=44. Every time you have to do an online transaction, you need to possess near you 1. Your mobile phone (where it will send an OTP (one time password), and 2. Your debit card, so that you can enter digits for any three randomly selected alphabets. I’m not sure how the second part increases security. The bank stops asking OTP once it knows that some specific IP is your home computer, but still, the debit card alphabet thingy is mandatory. And you know, there is NO option whatsoever to change this behavior.

There have been two cases when I needed to urgently transfer some amount, but the poor OTP SMS got stuck somewhere on their servers and didn’t reach me for the whole freaking day.


For a couple of months, funnily, their site was not working on any browser except Internet Explorer. Also, this bank also takes security too seriously. It doesn’t show you all the digits of your bank account (e.g. 1234xxxxxx9), and does the same with all the account numbers of beneficiaries you added. So once you add your friend as a beneficiary to this bank, and later you want to add him/her to another bank, you cannot see his/her account number here by any possible way. You need to ask him/her again his bank details, or store it somewhere in your notepad, physical or virtual.

Common problem

All of this don’t frustrate me enough. What makes me really furious is these banks have a habit of not sending an SMS when they debit my account for maintenance charges or a default. Every other transaction, be it a 10 Rupee mobile recharge, is accompanied with an SMS. Except when it’s them who are deducting the amount. SBI does it for annual debit card charges, Citibank deducted 300 Rupees each month, for 4 months, when my account stopped receiving any salary, without my attention. Turned out they changed my account from ‘suvidha’ to ‘basic’ without my knowledge. And ICICI did that with me too, debiting annual maintenance fee for the trading account, without a hint of me noticing. Do they want me to keep checking the online transaction history once in a while to catch my mistakes?

I consider this practice as ugly way of treating customers, and very very unfair, and should be stopped if the banks have any moral sense left in them. Perhaps I’ll some day use consumer forum (or will I need to file a PIL maybe?) to stop this fooling of common people by these banks. For today, I have an excuse that I don’t have enough time.

I am sure these are not the only banks which are below par in customer satisfaction. India has always had this culture that you need to be just as good as your competitors. If they are exploiting, you too can exploit upto the same extent. These banks too don’t seem to bother much about user satisfaction. They are just trying to be as good as their competitors. They don’t see this that if they provide superior services than their rivals, a guy will never ever leave them and won’t think of opening another bank account in his life.

Comments welcome!