Hidden banking charges hit 60%: Local Circles survey

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A recent national survey conducted by Local Circles shed light on the rapidly increasing and worrying trends of dark patterns engulfing India’s online banking space. The survey had responses from over 44,000 online banking users located across 363 Indian districts. With major participants being men (67%) and tier-1 residents (45%), it highlighted more than half the participants (63%) experienced drip pricing while transacting with online banking platforms. 

Drip pricing refers to charging the customers in a trickle-down manner. Charges are hidden upfront, but deducted later on. It is a form of dark pattern, where the customer is tricked into doing things they wouldn’t ordinarily, or intentionally do. For instance, creating false urgency regarding the availability of a product, subscription traps and more. 

Hidden charges, which can include annual credit card fee, charges for receiving SMS updates or for transferring funds, ranked very high on many customer’s grievances list while transacting online. Out of 11,390 responses received, 36% indicated frequently and 27% responded sometimes. Only 9% marked rarely as an answer to this. 

Around 41% respondents also noted encountering interface interference. This means they were redirected to buy a product or service whilst transacting on the online banking interface. Only 27% of the 11,152 responses received mentioned never encountering such dark patterns. 

32% of surveyed online banking users also indicated that they had experienced subscription traps. This means that while they could easily sign up for a new product or service whilst transacting on a banking platform, they had no easy way of unsubscribing from the same. The entire un-subscription process would rife with paperwork and even physical visits to the bank branch. However, at 36%, a slightly bigger sect of respondents noted that they had never encountered subscription traps. 

Another dark pattern that emerged was baiting and switching, with 39% respondents agreeing to have experienced it. A common pattern noticed herein was the stark difference in interest rates advertised and actually charged post the transaction is done. Bait and switch means to display product A, while delivering an entirely different product B to the customer.