> Posted by Sucheta Dalal, Founding Trustee, Moneylife Foundation

World Consumer Rights Day is March 15. To celebrate, this week we’ll be sharing posts that explore the importance of client protection and initiatives that strengthen responsible practices in providing financial services. Given the tremendous growth of mobile phone-based financial services, it’s fitting that the theme of this year’s day is “fix our phone rights.”

India’s independent legal system and an activist judiciary are touted as the key to its vibrant democracy. However, those who have had to deal with India’s expensive and excruciatingly slow legal system know otherwise. Justice delayed is justice denied – this is especially true for the poor, the disempowered, and the middle class in India, who have to wait for decades for a judgment to be delivered. Add to this the fact that many laws are complex, the language obtuse and technical, new statutes are enacted without repealing old ones, and you get a picture of how the system really works.

In the past two decades after India embarked on an economic liberalization process, it also set up a slew of “independent regulators” to regulate capital markets, insurance, pensions, telecom, electricity distribution, etc., with full powers to receive complaints and act on them. All this means that citizens are constantly struggling for help in finding the right remedy or appropriate forum to resolve their grievances.

For instance, a person with a complaint against a bank can approach a banking ombudsman and get a fast and inexpensive resolution. But a consumer court, set up under a separate statute, would offer far better results if one were to complain about being missold an insurance policy or mutual fund. However, very few people know the difference. Ignorance about the laws governing information technology, social media, or privacy issues is even more endemic.

In response to a stream of queries and requests for support and counseling on legal issues, Moneylife Foundation set up a Legal Resource Centre (LRC). The LRC is not a legal aid centre in the sense that it does not draft lawsuits, file complaints, or argue cases for people. There are government-supported legal aid cells attached to Indian courts as is the norm in many countries.

In India, many people need guidance and counseling before the filing of a complaint or legal action. The information can be as basic as how to file a complaint, the possible cost and timeframe in which one could expect resolution, anticipating unforeseen negative consequences of certain actions, and finally, help in researching one’s case and finding the right representation.

Sometimes language becomes an obstacle to communication and comprehension in a country of such extraordinary diversity. Mumbai, India’s biggest metropolis, has four commonly used languages – Marathi, Hindi, English, Gujarati, and there is a huge migrant population that is familiar with their own dialects or other regional languages.

Given the vast canvas that the LRC will have to cover, we are only in a position to take a few baby steps. We have identified 10 focus areas, and we hope to extend the scope of our work in line with our ability to meet initial targets. These are:

  • Guidance for filing complaints with financial regulators and stock exchanges
  • Filing complaints with consumer forums
  • Guidance on the Information Technology Act and issues that affect life and liberty
  • Filing public interest litigation
  • Guidance and counseling to potential whistleblowers
  • Guidance about provisions and possible consequences of filing sexual harassment complaints
  • Guidance on wills and transmission of assets
  • Filing applications and appeals under the Right to Information Act
  • Guidance on property and real estate related issues
  • Basic research on legal precedents on new statutes, such as filing of class action suits

The last four are areas where I strongly feel the need for correct guidance on the negative consequences of initiating legal action. The mere existence of strong legislation does not protect someone who files a sexual harassment complaint or a whistleblower from a nasty backlash, especially when the complaint is against powerful individuals or corporations. In India, one has to factor corruption that makes room for endless delays and manipulation. A naïve complainant or whistleblower can end up destroying his or her life or career and we believe it is important to counsel them about the negative consequences of failing to have a goal and a strategy to get the best results.

How important is the work we have embarked on? Moneylife Foundation has 28,600 members who receive our mailings promoting new helplines and services. But even without a single mailing, the news of the launch of the LRC alone has triggered over 24 queries in less than a week, ranging from financial issues to property matters and recovering fixed term deposits with companies. Our team of voluntary legal and domain experts have successfully resolved most of these queries, but our worry is that without resources to have several full-time experts on the foundation’s payroll, we may be unable to deal with the flood of help requests that we are bound to receive.

Image credit: LRC

Have you read?

The Difficult Crawl Towards Non-Discrimination – Financial and Otherwise

Cleaning Up Debt Collection in the U.S.

Why the Fine Print Matters