Kotak's Ashok Vaswani Turns A New Page In Dealing With Customer Issues

Less than 24 hours ago, Captain Vikram Srivastava had the shock of his life. While banks taking customers’ consent to upgrade their accounts is the norm, Kotak Mahindra Bank allegedly did no such thing while upgrading his parents’ accounts to private banking.

The bank, instead, penalised them with approximately Rs 280 for not maintaining a minimum balance of Rs 2 lakh. He expressed astonishment while speaking to NDTV Profit that a call centre person had the authority to reverse these charges, but nobody bothered to inform the customer about these charges in the first place.

But he didn’t hesitate to voice his thoughts on LinkedIn and also tagged Ashok Vaswani, the managing director and chief executive of the bank.

Typically, top officials of leading private banks don’t engage with the public regarding individual grievances. But to his surprise, Vaswani replied, apologising for the bank’s conduct and ensuring appropriate changes.

“Dear Captain Srivastava, I do sincerely apologise for the way your parents have been treated. I understand your frustration. I will look into this and make sure we make appropriate changes. Sincerely, Ashok,” he wrote.

In a LinkedIn post on Feb. 21, he summarised his first 45 days at the bank as "exhilarating, energising and inspiring."

He said, "Along with the fantastic team and leadership, I’m committed to taking Kotak to its rightful pre-eminent position in the most vibrant economy in the world, with a deeper focus on customer-centricity."

Surprise aside, Vaswani’s prompt response to Srivastava raised an important question: Was it a smart move for a bank’s CEO to engage in individual grievances?

It was a very smart move and definitely presented Kotak Mahindra Bank in a good light, according to Prahlad Kakkar, a veteran ad film director. From a brand and image point of view, it gave the right message to customers that the bank is alert and considerate of its customers’ needs, he said.

“Compared to nationalised banks, the complaints that come to private banks are way less," he said. "So, if the CEO of a big private bank has responded, it shows that they care."

Mahesh Singhi, founder and MD of Singhi Advisors, agrees. “Banking, as an activity, is a factor of trust. So, it's important to connect with the consumers."

Vaswani’s response is symbolic of care, especially since he is a new CEO, Singhi said. “The responsibility increases as there was always a perception that Uday Kotak would take care of the bank," he said. "And with this, the message goes to the bank’s team as well, showing that top management looks at everything."

Though action emphasises that Kotak Mahindra Bank is a customer-conscious bank, it's not a scaleable or sustainable idea, according to Karthik Srinivasan, a personal branding and communication strategy consultant.

“It's scaleable only if there is a process behind it—a customer care team following up or responding would be a better way to deal with it,” he said. “It’s a noble idea but also gives a misguided signal that one can tag the CEO and expect a response, rather than going through official channels for resolution,” he added.

It is not bad as a one-off thing; if the bank plans to do something like this selectively or once a month, there will be a big perception change for Kotak as a bank, Srinivasan said.