Fair Practices Code for Retail Lending Products

This policy will cover the following products:

• Personal Loans
• Credit Cards
• Professional Credit
• Smart Credit
• SME Products
• Mortgages

The policy will be effective immediately

• Loan Application forms/Most Important Document (MID) shall be comprehensive to include information about rate of interest (fixed/ floating) and manner of charging (monthly/ quarterly/ half-yearly/ yearly rests), process fees and other charges, penal interest rates, pre-payment options and any other matter which affects the interest of the applicant, so that a meaningful comparison with that of other banks can be made and informed decision can be taken by the borrower. A copy of the MID would be retained with the applicant for his future reference. The MID would also act as an acknowledgement for the applicant for having submitted the application form.
• All loan applications will be verified/ processed within a reasonable period of time. The minimum time expected to complete processing of the application would be indicated in the MID, and the telephone numbers/e-Mail addresses which the applicant can use to contact the Bank in case of a delay, would also be shown in the MID as well as in the website.
• If additional details/ documents are required, these will be intimated the applicant through a letter addressed to the applicant or through the agencies.
• MID would also state the amount of process fees paid or to be paid and the extent to which such fees shall be refunded in the event of rejection of any application for loan.
• In the case of rejection of any loan application, the bank will convey in writing the reason for rejection
• The bank will ensure that there is proper assessment of credit requirement of applicant. The credit limit/loan amount, which may be sanctioned, would be communicated to the applicant.
• Terms and conditions and other caveats governing credit facilities given by the bank would be informed to the applicant, through loan agreements/ Terms and Conditions/ Rules and Regulations booklets along with credit card packs etc. The customer will also have access to the rules and regulations/ terms and conditions through the website of the Bank.
• The bank will ensure timely disbursement of loans sanctioned, and the expected timelines would be mentioned in the MID.
• For all the over draft products and credit cards the bank will keep the borrowers apprised of the state of their accounts from time to time in the form of monthly/ quarterly/ yearly statements/ repayment schedules. For loan products the bank will update the borrowers of the state of their accounts on request. The Bank shall give notice of any change in the terms and conditions including interest rates, service charges etc. Also the Bank will ensure that changes in interest rates and charges are effected only prospectively.
• The loan agreement/ terms and conditions/ rules and regulations document, which is made available to the applicant will clearly specify the liability of the bank to applicants in regard to allowing drawings beyond the sanctioned limits, honouring the cheques issued for the purpose other than agreed, disallowing large cash withdrawals and obligation to meet further requirements of the borrowers on account of growth in business etc. without proper revision and sanction in credit limits, and disallowing drawings on a borrowing account on its classification as a non- performing asset or on account of non-compliance with the terms of sanction.
• The bank will give reasonable notice to applicants/ customers before taking decision to recall/ accelerate payment or performance under the agreement or seeking additional securities.
• The bank will release all securities/ collaterals on receiving payment of loan or realisation of loan subject to any legitimate right of lien for any other claim bank may have against borrowers. If such right of set off on securities/ collaterals is to be exercised, applicants/customers shall be given notice about the same with full particulars about the remaining claims and the documents under which the bank is entitled to retain the securities till the relevant claims are settled / paid.
• Any dispute arising on account of the above policy points will be referred to the appropriate authorities or to the grievance redressal group comprising Product Manager / CAU manager / Sales manager for the business /product. The contact numbers where the customers can call for redressal of such complaints, mail/ email addresses where he can communicate with the Bank for redressal of such complaints would be made available through various channels.
• Further compliance to the above policy will be reviewed and reported every quarter.
• The Bank would restrain from interference in the affairs of the borrowers except for what is provided in the terms and conditions of the loan sanction documents (unless new information, not earlier disclosed by the borrower, has come to the notice of the lender).
• The Bank would not discriminate on grounds of sex, caste and religion in the matter of lending. However, this does not preclude credit-linked schemes framed for weaker sections of the society.
• In the matter of recovery of loans, the Bank would not resort to undue harassment viz. persistently bothering the borrowers at odd hours, use of muscle power for recovery of loans, etc.
• In case of receipt of request for transfer of borrowal account, either from the borrower or from a bank / financial institution, which proposes to take- over the account, the consent or otherwise i.e., objection of the bank, if any, would be conveyed within a reasonable time from the date of receipt of request.