Prior to the acquisition of Citibank’s retail banking division by Axis Bank, Citibank customers were advised to transfer their accounts to Axis Bank.
Chaos ensued at the Citibank branch on MG Road in Bengaluru on Thursday, February 9, as customers rushed to reactivate their abruptly deactivated accounts. At around 6 p.m. on Wednesday, account holders with Citibank received a text message saying their accounts had been “closed” and that their ATM cards and checkbooks were no longer valid. When a TNM reporter went to Citibank’s MG Road branch, he was not allowed inside, citing the reason that he was not an account holder. One of the customers, Srinivasan, had walked into the bank and refused to leave until the problem was resolved. He told TNM that the police were called in order to persuade him and other customers with similar grievances to leave and “cooperate” with the banking authorities, but they did not budge.
In March 2022, Axis Bank announced the acquisition of Citibank’s retail banking division. After the announcement, Citibank customers were asked to consent to transfer their accounts to Axis Bank. A customer said he received persistent calls from Citibank asking him to switch to Axis Bank. While several customers agreed to the change, many of those who did not consent had their accounts, ATM cards and checkbooks deactivated without any notification on Wednesday, February 8. Customers also told TNM they were not told what would happen to the money. in their accounts if they have not consented to switch to Axis Bank. However, as customers went to the bank and demanded that their accounts be reactivated, the bank complied, but only after receiving a consent letter from the customers to switch to Axis Bank.
Speaking to TNM, Anil (name changed), a customer who went to MG Road branch on Thursday to have his account reactivated, said he panicked when he received the message from the bank on Wednesday evening. “I tried to contact customer service yesterday but was not connected to anyone. I tried until 12 noon and then decided to come to the bank today,” he said. When he spoke to others at the bank who had come to deal with the same problem, Anil said he learned that some of them had deposited all of their savings for the past 20 years or so into their Citibank accounts.
A lawyer by profession, Anil argued that sending emails and text messages was the wrong way to get people’s consent while asking them to switch bank accounts. He said: “The bank did not specifically explain what transferring accounts to Axis Bank would entail. There is still time for the merger until the end of March this year. But even before that they deactivated our accounts. Arguing that it is up to the customer to switch banks and that banks cannot force them to do so, the lawyer said that Citibank compelled customers to transfer their accounts to Axis Bank.
Shahul Hameed, a technician from Chennai, also had a similar experience. However, he didn’t worry much since his main bank account was not Citibank. Hameed said: “I received calls from someone from Citibank asking me to transfer my account to Axis Bank. They said all my old transaction records will be deleted if I don’t choose to change. But I did not consent. The calls were persistent so I stopped taking them. But I didn’t know that they would just close my account without any indication.
When asked what he planned to do about his deactivated account, Hameed replied that he would wait for it as it was not his main bank account. He said: “The deactivation would be a big problem for people who gave this account for automatic debiting of EMIs and things like that. So it didn’t hit me as hard as it might have hit most account holders. But the problem is how the message about closing the accounts was communicated. There was no reasoning behind this decision or communication about what would happen to the money in these accounts. It was very poorly managed. TNM attempted to contact the manager of Citibank’s MG Road branch, but he declined to comment on the situation or answer questions.