A Short-Credited Inward Remittance and an Angry Mother
Ms. Latha Nair, 66, of Chennai, is expecting USD 5,000 from her daughter in Texas for her cataract and cardiac treatment. The daughter instructs her US bank to send the money by SWIFT and the branch there marks field 71A as "SHA". The correspondent bank deducts USD 30 and the Indian bank deducts USD 12 as its own inward remittance charge plus Rs 500 and GST. Ms. Nair's account is credited with USD 4,958 six days after the value date, though the bank's brochure advertises "same-day credit of inward remittances". On day three the bank had called her for a hospital estimate because the purpose code on the wire read "family maintenance" rather than medical treatment. She is furious about the missing USD 42 and the delay, says the bank has no right to touch her daughter's money, and threatens to complain.
1. Explain the deductions and the delay, and state what could have been done to receive full value.
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The deductions follow the charge code in field 71A. "SHA" means the remitter pays her own bank's charges, while the correspondent bank and the beneficiary bank recover theirs from the amount. "OUR" would have made the remitter pay everything and delivered USD 5,000 to Ms. Nair; "BEN" would have loaded all charges on her.
So USD 30 is the correspondent's charge, outside the Indian bank's control, and USD 12 plus Rs 500 and GST is the Indian bank's own tariff charge, which must be disclosed in its published schedule. Six days, not the same day, reflects the value date, the correspondent leg and the bank's query on the purpose code: a generic code with no supporting document invites a clarification call, and the brochure claim cannot override the actual cut-offs and query time.
To get full value on a medical remittance, the daughter should have selected OUR and stated the correct purpose.
2. Was the bank right to query the purpose, and does the wrong purpose code create a problem for Ms. Nair?
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The query was reasonable. Purpose codes are prescribed data elements that feed the bank's regulatory reporting and determine what checks apply. "Family maintenance" for a hospital payment is inconsistent with the underlying transaction, and a bank that ignores the mismatch is failing its own diligence. Asking for a hospital estimate was a proportionate response to an unexplained inward remittance.
Ms. Nair herself commits no contravention: receiving money from a daughter abroad for medical treatment is freely permitted, and inward remittances from close relatives do not need prior approval. The defect is a reporting one on the remitter side, and the bank should correct its record to show medical treatment once the estimate is produced. She should be told plainly that the query protected both of them and that the corrected code will prevent a repeat.
3. Set out the correct complaint route and what she can realistically recover.
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Step one is a written complaint to the bank's branch and its grievance redressal or nodal officer, with the wire reference, the credit advice and the hospital estimate. The bank must respond within 30 days.
If there is no reply within that period, or the reply is unsatisfactory, she can escalate free of charge to the RBI's Integrated Ombudsman Scheme, 2021, through the online portal, without a lawyer. The Ombudsman's award is subject to the prescribed monetary cap and can include limited compensation for loss of time and harassment, but it will not rewrite contractual charge codes.
The USD 42 is unlikely to be refunded, because the deductions follow the wire instruction and the bank's published tariff. Her stronger ground, if any, is the gap between the "same-day credit" promise and the actual credit, if the delay was purely the bank's own and not the query; she should raise that specifically and keep every document.