A wise guy learns not only from his mistake but also from others. I hope this information is useful not only for customers who want to build new relationship with HSBC but also for those who already have accounts with HSBC. If not anything, you can take some corrective actions proactively.
HSBC Smart Home is a type of offset mortgage product(also knows as Current Account mortgage). Few banks like Standard Chartered, Citibank and SBI offering similar products. Since such products are offered by very few banks, they are not popular. Moreover, the product becomes extremely complex due to misleading documentation and service provided by HSBC.
Being customer with HSBC for nearly four years, and having had many bad experiences with this product and services, I am inclined to write this review.
Let me share all experiences till now.
It took more than 2 months to get loan approval despite it was a loan transfer application. All delays could be attributed to their internal issues.
HSBC Interest rates are among the highest. If the loan is linked to RPLR, you will be shocked that your interest rate will jump way beyond your imagination. It is not rare that HSBC charges more than 13% interest to their home loan customer who took loan prior to 01-July-2010. I was paying 12.5% interest rate when market was offering loan at 8.5%. Refer to my diary on how to reduce interest rate.
HSBC did not provide MITC(most important terms and conditions) document for Smart Home Loan and Powervantage(HSBC Advance) account. In fact, HSBC did not have MITC document for Smart Home until September-2010. This is against the Banking code of conducts and HSBC’s own code of conduct.
I requested HSBC to transfer funds from my HSBC Advance Current account(India) to HSBC Plus Current Account in UK by following the procedure informed by the NRI call centre. However, HSBC did not fulfill request. They neither provided any reason in writing or nor informed me. I had to visit India to transfer funds finally.
HSBC does not state clearly that HSBC Smart Home is also HSBC Advance Current Account. Most of the HSBC staff does not understand this account as current account. You will find that majority of HSBC staff do not know that it is also HSBC Advance Current Account. It took me 6 emails before HSBC accepted that my account is also a HSBC Advance Current Account!
HSBC does not provide account statements for HSBC Advance Current Account separately despite their HSBC Advance MITC(Section 15.1) states that they will provide account statements. You can NOT use Smart Home account statement to show available balance for the purpose of visa or taking loan or any relevant reasons even though you can use it as your main account to take advantage of lower interest payments. You might get shock of your life when you least expect it. Even your CIBIL reports will be incorrect, and you will need to explain your bank when you apply for another loan.
HSBC did not deduct EMI for any Smart Home customers for till Dec-2008 and misled all customers about how this product works. When they were forced to correct their mistake, they changed their system but did not inform their existing customers about their mistakes. I came to know this from HSBC staff on condition of anonymity. This is a clear example of unethical management and misleading feature document presented on their webpage.
I could not register biller for more than 3 months due to faulty system. HSBC blamed me all the time until I demonstrated defect in their software system.
In one specific month, all my bill payments reverted back without being informed on time. The local electricity company disconnected my electricity for non payment of bills, and that’s the time I realized HSBC’s mistake.
It took me more than 2 months to convert loan from RPLR to base rate system. HSBC staff did not know process for converting loan to base rate system, despite they request customer to contact their local office. Refer to my diary for more details.
If you request for passbook for your account, guess what, you will get an empty folder from HSBC with a heading stating “Passbook”. You can carry this folder home and file your monthly statements or online statement. Yes, I am not kidding…This is the definition of passbook as per HSBC. And if you request passbook update after three months(essentially requesting a statement), they will charge you 100 Rupee for every statement.
After a while, they will stop responding to you or updating you when you complain. They will not speak to you for any problem resolution, and if at all they do, you can not rely on them because; they will not provide you anything in writing. So, to give you an example, a staff in MG Road office informed that HSBC Office does not know how to convert loan from RPLR to Base rate system when personally visited bank after 1.5 month of initiating request. BUT she declined to give the same reason in writing.
Great leaders believe in, “do what you say, and say what you do” or “walk your talk”. HSBC believes in exactly opposite. For example, they will state that your suggestion is accepted, but it does not mean they will make necessary changes as per your suggestion. They stated that specific statement in MITC clarifies everything, when MITC itself did not exist. You can not find the statement even when MITC was made available on their webpage. And the worst is, they will not send hard copy of MITC document for your HSBC Advance Current account even if you request it strongly. I can go on and on, but let me stop here…
In another interesting feature, HSBC never keeps your original email while replying it. It will make it almost impossible to for you to prove your point to anyone else. Needless to say, this is as per their so called policy and it will probably meet banking standards. We all know how poor are banking standards all over the world, so I don’t think I need to explain it any further. They will use word policy very often to scare all customers, knowing that it’s not easy for customer to take on with them in India. The same bank works very differently in UK, by the way due to strong legal system.
HSBC will not inform you when interest rates change, particularly when it increases.
If you get tired of all experiences and if you want to close your account, you need to pay penalty even if you close your loan using your own funds! It looks like most innovative customer retention policy.
Yes, majority of problems got resolved by “hook or crook” mechanism or in some cases, time resolved them. But sometime, you could be unlucky. Have you heard of Murphy’s Law, “Whatever can go wrong, will go wrong particularly when you least expect it”
I plan to write few more reviews about their other products and services. Hope it will be useful.
In general, you will find HSBC staff right from the call centre employee till CEO and nodal officer, very manipulative and unethical. In some cases where it’s proven beyond doubt and you literally press them hard, they will apologize for their mistake without offering any compensation to customer even though customer might have lost millions because of their mistake.
I suggest you to be careful if at all you want to BANK with HSBC, the worst local bank, in my view. I would recommend AVOID banking with HSBC at all costs if at all you have choice.