Indian banks follow the Banking Ombudsman Scheme to protect customers. What is the primary role of the Ombudsman in a bank with respect to handling customer issues and complaints?

Introduction / Context:
This question relates to consumer protection in the banking sector and the role of the Banking Ombudsman. The Ombudsman is an independent authority created to handle customer complaints against banks. Understanding this role helps you answer questions on financial awareness and regulatory mechanisms in India.

Given Data / Assumptions:

• The question refers to the Ombudsman in the context of banks in India.
• There is a specific Banking Ombudsman Scheme administered by the Reserve Bank of India.
• The options mention various possible functions like grievance redressal, inspection, policy suggestions and programme monitoring.
• Only one option correctly captures the primary and central duty of the Ombudsman.

Concept / Approach:
The Banking Ombudsman Scheme was introduced to provide an inexpensive, quick and impartial mechanism for resolving customer complaints relating to banking services. Therefore, the key phrase you should associate with the Ombudsman is "redressal of grievances" and "speedy resolution" of complaints. While the Ombudsman may indirectly influence service improvement, it does not directly monitor poverty programmes, approve corporate loans or primarily design new schemes.

Step-by-Step Solution:
Step 1: Recall that the Banking Ombudsman is appointed by the Reserve Bank of India to handle complaints from bank customers. Step 2: Understand that the scheme allows customers to approach the Ombudsman free of cost if their complaints are not resolved satisfactorily by the bank. Step 3: Read option A carefully, which emphasises quality and speedy redressal of grievances of customers. This aligns directly with the purpose of the scheme. Step 4: Compare other options, which talk about suggestions for new schemes, internal inspections, monitoring poverty programmes or approving loans. These are not the core function of the Ombudsman. Step 5: Conclude that option A correctly describes the primary role of the bank Ombudsman.

Verification / Alternative check:
If you have studied basic banking awareness, you will recall that the Banking Ombudsman acts as a quasi judicial authority for resolving disputes between customers and banks. Official descriptions always highlight grievance redressal and not routine supervision or policy making. You can also compare this with internal audit teams, which handle inspections, and bank boards, which decide on large loans. This comparison further confirms that grievance redressal is the correct function to associate with the Ombudsman.

Why Other Options Are Wrong:
Providing suggestions for innovative schemes is more related to bank management and product development teams, not to the Ombudsman, whose job is dispute resolution.
Inspecting the internal working of branches is the duty of internal inspectors, auditors and sometimes the central bank, not of the Ombudsman.
Monitoring poverty alleviation programmes falls under government departments and specialised agencies, not under the grievance redressal authority of banks.
Approving loans for large corporate customers is the responsibility of credit committees and bank boards, which is completely different from the neutral role played by the Ombudsman.

Common Pitfalls:
Students sometimes confuse the Ombudsman with regulatory bodies or bank management, assuming that the post has broad powers over branch operations or policy. Another pitfall is to think that any authority associated with the Reserve Bank of India must also inspect banks routinely. In reality, the Ombudsman is focused on resolving specific customer complaints in a quick and fair manner. Keeping this narrow but important mandate in mind will help you choose the correct option reliably in exams.

Final Answer:
The Ombudsman in a bank is primarily responsible for providing quality and speedy redressal of grievances of customers under the Banking Ombudsman Scheme.