Background

RBI has issued the guidelines on Fair Practices Code for Non-Banking Finance Companies which sets the fair practices standards when dealing with individual customers and to serve as a part of best corporate practice. In view of this, the Company has adopted the code to provide transparency in business dealings with its borrowers.

Application of the Code

This Fair Practices Code applies to all categories of products and services offered by the Company whether the products and services are provided across the counter, over the phone, through interactive electronic devices, on the internet, or by any other method.

Key Commitments

Applications for Loans and their Processing: Loan application forms will include necessary information, which affects the interest of the borrower, so that a meaningful comparison with the terms and conditions offered by other NBFCs can be made and an informed decision can be taken by the borrower. The loan application form will indicate the documents required to be submitted with the application form. The loan application form and the sanction letter / MID (Most Important Document) issued to the customer shall disclose the approach for gradation of risks and rationale for charging different rates of interest to different categories of borrowers, and the same shall also be made available on the website of the company. The information shall be updated whenever there is a change in the rates of interest.

The company will devise a system of giving acknowledgement for receipt of all loan applications. Preferably, the time frame within which loan applications will be disposed of will also be indicated in the acknowledgement. If the Company cannot provide the loan to the borrower, the same shall be communicated to the borrower with the reason(s) for rejection.

Loan Appraisal and Terms/Conditions

The company will convey in writing to the borrower by means of a sanction letter or otherwise, the amounts of loan sanctioned along with the terms and conditions including annualised rate of interest and method of application thereof and keep the acceptance of these terms and conditions by the borrower on its record.

The loan sanction letter and all communications to the borrower shall be in the vernacular language or a language understood by the borrower.

Disbursement of Loans Including Changes in Terms and Conditions

The Company will give notice to the borrower of any change in the terms and conditions including disbursement schedule, interest rates, service charges, prepayment charges, etc. We will also ensure that changes in interest rates and charges are effected only prospectively. A suitable condition in this regard will be incorporated in the loan agreement.

General

The company will refrain from interference in the affairs of the borrower except for the purposes provided in the terms and conditions of the loan agreement (unless new information, not earlier disclosed by the borrower, has come to the notice of the lender).

Complaints

In case of any complaint/grievance, the applicant/borrowers will have to inform in writing the concerned branch. The Branch Officials shall immediately take up the matter for redressal as per the policy. In case the complaint remains unresolved, the borrower shall write to Zonal Office Level.

All disputes in relation to the products and services shall be heard and disposed of within 30 days from the date of receipt of the complete details in respect of the grievance.

A consolidated report of periodical review of compliance of the fair practice code and functioning of the grievances redressal mechanism at various levels of management may be submitted to the Board/Committee of Directors at regular intervals as may be prescribed by it.