From the marketer's perspective, it would be wise to remember that the equity of your brand is exposed to the risk of being sullied if your ill-trained, insensitive and mechanical readers of the telemarketing script continue to irritate the high-net worth consumer in the market.

H N Sinor, Chief Executive, Indian Banks' Association

The Supreme Court has recently admitted a PIL that seeks the Court's intervention against calls made by telemarketing agencies claiming that these calls invade the customers' privacy.

While the PIL hearing process will take its due course, the attention seems to be focusing on the telemarketing agencies/ direct sales agents.

Before we pass any judgement against these agencies, their role needs to be seen from a different perspective, particularly in relation to the evolution of the consumption-driven economic growth of the country.

The current economic boom has resulted in higher spending by the usually-conservative Indian consumers. According to the ministry of statistics, the private final consumption expenditure has risen by 8.3 per cent during 2003-04 in comparison with the previous year, and this is the highest growth rate in 23 years.

A rise in PFCE growth rate also suggests a rise in the income in the hands of the customer. Considering that this component forms 60 per cent of the GDP measured by the expenditure or demand method (as compared with the GDP by economic activity, which divides the GDP into agriculture, industry and services), it suggests that most of the rise in the GDP is coming from PFCE growth.

One of the main reasons for the PFCE growth has been the banks' ability to extend their retail services at the consumer's doorstep. The banks have achieved this through the services of the direct sales agents or the direct marketing agents. The DSAs are entrepreneurs who employ agents and have ability to offer personalised service to the end customers.

These agents provide scale and cost efficiency that gets passed on to the end consumer. The growth of these intermediaries has also created new employment opportunities and has further fuelled consumerism.

Currently, about 15-20,000 young men and women are employed by direct sales agents of banks as telemarketing agents and field sales personnel.

The agents bring convenience, comfort and speed in today's fast-paced life of the customers by offering door-to-door services. The customer gets personalised services and the service providers are able to offer this service only because of the efficiency that the agents bring to the delivery channel.

This is evidenced from the fact that 40 to 50 per cent of cards and up to 25 per cent of retail loans are sold through telemarketing, which translates into at least 300,000 cards a month.

Pro-active sales initiatives by banks have improved consumer awareness and knowledge of products exponentially over the past five years. This has benefited consumers by way of lower annual fees, lower rates of interest on retail loans, improved service, and so on.

Telemarketing enables banks to significantly reduce sales-related expenditure that is being passed on to the consumers, which may not be possible under a direct sales approach. As a measure of cost dynamics, tele-sales is at least 40 to 50 per cent more economical than other sales options.

The advent of mobile technology has further enabled the banks widen the net of "anywhere banking". What is, however, needed is an urgent need on the part of the banks to put in place a self-regulatory mechanism that is designed to protect customer privacy.