MRTPC has directed its investigation arm DGIR to probe whether banks discriminate against existing customers while wooing new ones by offering a lower floating rate on home loans.

“Banks are well aware of the fact that, existing (or old) customers are equally important for their business growth, as new customers. However, banks have to come up with short-term offers, like festival offers, to attract new business,” IndusInd Bank Managing Director, Bhaskar Ghose told PTI here.

Deceitful tactics
The commission had observed that banks often hesitate to explain pitfalls in calculating the interest rates to customers, thereby leaving them partly or fully unaware about the scheme.

“Investments may appear attractive in the borrowing plans of private sector banks, but there will be invisible charges, which the customer may not know,” Bank of India Chairman T S Narayanaswami said.

However, once the mandatory priority sector obligations are followed, “it is left to the banks how to move their credit portfolio,” he added. Banks like SBI and ICICI Bank had recently reduced interest rates on retail loans, including homeloans by 0.5-1 per cent in order to attract the new customers as part of their festival offers.