Misselling must stop, banking is about service, not targets: Bandhan Group chief

Days after Union Finance Minister Nirmala Sitharaman asked banks to stop misselling, Bandhan Group Chairman Chandra Sekhar Ghosh said misselling, which had increased after banks set targets for their employees, must stop immediately.

“Misselling should to immediately stop, no doubt. It is not good. It is a target. When you [banks] give the target, that will happen. I have been saying that in the private sector there is too much of target. Every morning they discuss on that what is your today’s target. It [banking] is not the targets business, it is a customer service business,” Mr. Ghosh, the former MD & CEO of Bandhan Bank, said in an exclusive interview.

“We did not sell any insurance, mutual fund products in the first 5 years of running the bank. We started after 5 years as customers asked for it, else they could have gone elsewhere. Now if any misselling happens we return the money within 24 hours. If you (staff] are not returning back money you will be terminated,” he emphasised. 

Commenting on recent frauds involving some private sector bank employees, he said there was a need for enhanced vigilance and stronger supervision at the branch level.

“After digital banking, the number of frauds have increased. Peoples’ greediness has increased. In NBFC and microfinance, people are more motivated to work, not to work for money. That has enabled our people to stay far away from the money,” Mr. Ghosh said.

He said Bandhan Bank had invested a lot of money in training the staff. “Training not on transactions but on motivation. They are told about the value of customers’ money,” Mr. Ghosh said. “Integrity has to come from the environment and from the checks and balances. The maker and checker need to be different persons. The checker must be of higher level. If monitoring supervision is hard no one like to do a fraud. Monitoring supervision is very important,” he added.

“I feel there is a need to strengthen the monitoring supervision. Strengthen the loyalty of the people,” he emphasised to prevent bank frauds by employees.  

The financial services veteran, who comes from an NGO working for financial inclusion of the bottom of the pyramid, welcomed the Union Budget proposal for a comprehensive review of the banking sector by a High-level Committee on Banking for Viksit Bharat.

“The Banking Regulation Act was enacted in 1949. Then the scenario was different when India was not even one trillion economy. It took 63 years to build up one trillion economy and within this next 3 years one trillion will be added. This cannot be achieved without banking support. So, the Act should be revised,” Mr. Ghosh said. 

He said due to existing restrictions, bank promoters are unable to increase their holding in the banks even if they have the money . “If you are the MD of the bank, your total family cannot invest more than ₹5,00,000. This needs to change,” he pointed out.

“I hope that the high level committee will make it. Today, due to the existing regulations, banks are not getting high quality board members. Several issues need to addressed. Norms should be revised to strengthen the banking services,” he said.

Stating that Vikshit Bharat needs to be supported by banks, he said unless 85% of India’s population, who have no access to bank credit, are financially included, Viksit Bharat cannot be possible.

“Inequality in our country is growing. Economy is growing, but inequality is also growing. It is not the good for the country. We should need to align the banking industry and all our services to minimise inequality. Then, Vikshit Bharat will have 50% population supporting the economy,” he said, adding banking rules needed to be changed to provide credit to “unbanked people”. 

He said microfinance was a viable business and could impact a large number of people. Now that the banking industry is seeking to mobilise deposits to advance credit at affordable costs, Mr. Ghosh asked them to go to rural areas where people have money.  

“There is need for physical branches in the rural areas for senior citizens and for less literate people. Because bank officers are not willing to go to rural we should develop banking skill to rural semi urban areas to tap the potential,” he said.

He said he would open more schools and hospitals in rural areas to provide high quality education and healthcare free of cost to the poorest of the poor. All this is happing through charity as he had donated 98% of his income to philanthropy keeping only 2% for himself. 

Published – February 27, 2026 10:28 pm IST