Bharti Airtel admits lapses in customer authentication process

“As you know, we take great pride in being a strong customer-centric brand that upholds the highest standards of governance. In this case, we did not meet our high standards,” Vittal said in a letter to all employees dated December 25.


Days after Unique Identification Authority of India, (UIDAI) suspended Aadhaar linked e-KYC services of the Airtel Payments Bank alleging misuse by the company, Bharti Airtel chief executive officer Gopal Vittal has admitted to lapses in governance in its customer authentication process. “As you know, we take great pride in being a strong customer-centric brand that upholds the highest standards of governance. In this case, we did not meet our high standards,” Vittal said in a letter to all employees dated December 25.

The UIDAI’s interim order had come after some customers of the telecom major alleged that the company had opened their bank account in Airtel Payments Bank when they used the “Aadhaar linked e-KYC services” without their consent. Shashi Arora, CEO and Managing Director, Airtel Payments Bank has stepped down following the suspension of Aadhaar linked e-KYC services by UIDAI on December 16 because of alleged misuse by the company.

Here is the letter by Gopal Vittal

Friends,

When one of the top officers of RBI handed over the license for Airtel Payments bank to us, he said three powerful words. Serve India well. Since its commencement Airtel Payments Bank has served over 50 million customers and has seen a transaction throughput of almost 3000 crores per month and growing. I have personally witnessed countless stories of our bank serving the most under banked customers in distant parts of remote rural India and doing so in a way that solves a genuine problem of access to the last mile. It is this solution to a real problem faced by millions of customers that Airtel wants to solve thereby fostering financial inclusion. This is what electrifies every one of us.

Yet recent days surrounding the events relating to UIDAI have filled me with a profound sense of regret and disappointment for the situation that we find ourselves in.

First, the facts.

  1. NPCI Regulations automatically credits Direct Benefit Transfers to the last bank account linked with Aadhar. Several lakhs of customers have received Direct Benefit Transfers credit for the very first time in their lives from Airtel Payments Bank because they never had a bank account. These customers have now secured the benefits of Direct Benefit Transfers. At the same time, it is entirely likely that many customers who opened a bank account with Airtel Payments Bank may have received a credit of Direct Benefit Transfers without being aware of it. For those who were unaware, this has probably caused great inconvenience and confusion. We understand that many other banks have had similar instances.
  2. Through NPCI we have reversed this credit, lying unused in the accounts with no activity into the previous bank accounts of customers. This has been done along with interest at 7.25% per annum, which the Payments Bank gives on all its bank balances. All the customers who did not get to use their credits have been, therefore, given this high interest benefit.

When you step back and look at the facts, while we can say we adhered to the letter of the regulation yet we have taken flak. Why is this? The answer is simple. We did not put the customer at the heart of the issue and also were slow to react to complaints forwarded by relevant authorities. At times like this it is simply unacceptable to take comfort behind the mere letter of the regulation. We must abide by the letter and spirit of the regulation. The only way to do this is to keep the customer at the heart of all our decision making. And that is where we must use this episode to learn some critical lessons.

The biggest lesson for me is that we could have handled the situation in a far better way. I would like to point out several things we could have done differently. First, we could have acted faster. If customers were inconvenienced, we knew. And we should have done something about it immediately. Second, we could have been far more responsive to the concerns of key Government departments. Third, we could have shown urgency relating to the spirit of compliance even if we adhered to the letter behind compliance. Each of these aspects are areas I would like us to do differently from here on. As you know, we take great pride in being a strong customer centric brand that upholds the highest standards of governance. In this case we did not meet our high standards. It is, therefore, vital that we keep raising our game on these issues every day. We must be acutely sensitive to customer pain. At the same time, we must also be very sensitive to the requirements expected from a banking institution.

I would like each of you to take this as a personal priority – we must all be responsive to the needs of our customers as well as Government agencies. In fact, we must use this unfortunate episode as an opportunity to raise our empathy and attention to compliance as well as customer experience. I expect each of you to live this from today relentlessly.

If we do this we will have a stronger, healthier and happier Airtel. That is the only way we will meet our purpose of serving India well and continuing to maintain our gold standards in compliance.