This Fair Practices Code has been framed with a view to providing to all its customers an effective overview of the practices followed by the Company while offering its products and services. This Fair Practices Code has been prepared to take into account the “Guidelines on Fair Practices Code for NBFCs” issued by the Reserve Bank of India updated from time to time and aims to enable customers to make informed decisions in respect of the facilities and services offered by the Company.

 

I. OBJECTIVES OF THE CODE

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This Code has been drawn up to:

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a.  Adopt the best practices in dealing with customers.

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b.  Provide to the customers' effective overview of practices followed by the Company in respect of financial facilities and       services offered by the Company to its Customers.

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c.  Enable customers to make an informed decision about the financial facilities and services offered by the Company.

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d.  Promote good, fair, transparent, and legally tenable practices by setting minimum standards in dealings with customers.

 

e.  Enable customers to have a better understanding of what they can reasonably expect of the services offered by the Company.

 

f.  Reckon with market forces, through competition and strive to achieve higher operating standards.

 

g.  Foster fair and cordial relationships between the customers and the Company.

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The Fair Practices Code adopted by the Company covers the following areas.

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1.  Applications for loans and their processing.

 

2.  Loan appraisal and terms/conditions.

 

3.  Disbursement of loans, including changes in terms and conditions.

 

4.  Disclosures about interest rates and approach for gradation of risk,

 

5.  Policy on KYC, Proper Documentation, and Customer Profiling.

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6.  Confidentiality

 

7.  Grievance redressal mechanism

 

8.  General Provisions

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II. APPLICATIONS FOR LOANS AND THEIR PROCESSING

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(a) All communications to the borrower shall be either in English or in the vernacular language or in a language as understood by the borrower.

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(b) Loan application forms issued by the Company shall include necessary information affecting the interests of the borrower, which will enable him to take an informed decision by comparing the terms and conditions with that of other similar NBFCs, and shall also indicate the documents required to be executed/submitted by the borrower.

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(c) If any additional documents/information are required from the Customer, the same shall be communicated to the Customer immediately.

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III. LOAN APPRAISAL AND TERMS AND CONDITIONS

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a. The borrower shall be given a loan sanction letter and copy of the loan document together with annexures/enclosures quoted therein in the vernacular language or a language as understood by the borrower which shall include the details of the loan such as amount sanctioned, annualized interest rate, method of application thereof and any other terms and conditions. 

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b. The penal interest that will be charged for late payment shall be mentioned in bold letters in the sanction letter/loan document.

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c. An acknowledged copy of the sanction letter shall be kept as part of the document.

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d. Subject to receipt of all the requisite information and completion of documentation and creation of charge over the loan amount, loan applications shall be disposed of in the normal course on the same day of receipt of the application form complete in all respects. However, if there is any delay in sanctioning the loan beyond the period of 1 day due to reasons like field verification etc, the customer shall be given an acknowledgment for receipt of the application also indicating the time frame within which the loan application will be disposed of. The customer shall be kept informed of the status of his application.

 

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IV. RATE OF INTEREST

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a. The Company shall frame appropriate internal policies and procedures for determining the interest rates and processing and other charges, if any, and also ensure that they are not excessive. The Company shall, at the time of disbursal, ensure that the interest rate and other charges, if any, on loan and advances are in strict adherence to above referred        internal policies and procedures.

 

b. The rate of interest will be annualized rates so that the borrower is aware of the exact rates that would be charged on the loan

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c. The information published on the website shall be updated whenever there is a change in the rates.

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d. The rate of interest and the approach for gradation of risk and rationale for charging rates of interest to different schemes shall be disclosed in the application form and also communicated explicitly in the sanction letter issued to the borrower.

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e. The rates of interest and the approach for gradation of risk shall also be made available on the website.

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f. Interest rate slab changes meant to encourage timely interest payment, levying of additional interest for discouraging loans from crossing the sanctioned period etc, shall be mentioned clearly in the loan agreement.

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g. No Prepayment penalties/foreclosure charges will be levied on personal loans in the normal course. In case such  charges are applicable for any scheme, it will be disclosed in the sanction letter.

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V. CONFIDENTIALITY

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a. Unless authorized by the borrower, the Company will treat all personal information as private and confidential.

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b. The Company may not reveal transaction details of the borrowers to any other persons except under the following circumstances.

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i)  If the Company is required to provide the information as per regulatory directives to any statutory or regulatory body or bodies.

ii)  If arising out of a duty to the public to reveal the information.

iii)  If it is in the interest of the borrower to provide such information (eg. Fraud prevention)

iv) If the borrower has authorized the Company to provide such information to its group/associate/entities or Companies or any such person/entity as specifically agreed upon.

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VI. GRIEVANCE REDRESSAL MECHANISM

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Towards ensuring redressal of disputes arising out of decisions of the functionaries of the Company, the following mechanism is put in place:

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a. The decisions of any official below the Branch Manager shall be heard and disposed of by the Branch Manager.

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b. Decisions of Branch Managers shall be heard and disposed of by the Finance executive.

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c. If not satisfied with the decision of the branch manager, the customer has the option to escalate the matter to Grievances Redressal to the Company’s Director.

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I. The contact details of the Grievance Redressal Officer as also that of the Regional Office of the Reserve Bank of India shall be displayed in all the Branches for the benefit of customers. If the complaint/dispute is not redressed within a period of one month, the customer may appeal to the Officer-in-Charge of the Regional Office of DNBS of RBI as per the contact details displayed in the branch.

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II. Proper training shall be imparted to staff on an ongoing basis with a view to improving staff behavior and customer service.

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III. The compliance of the fair practices code, as well as the functioning of the Customer Grievances Redressal Cell, shall be reviewed by the Executive Director on a quarterly basis and a consolidated report of such reviews shall be studied for future basis.

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VII. GENERAL PROVISIONS

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a. The Company shall refrain from interfering in the affairs of the borrower except for the purposes provided in the terms and conditions of the letter of undertaking (unless new information, not earlier disclosed by the borrower, has come to the notice of the Company).

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b. The Company will not entertain any request for transfer of borrower accounts as this is not practicable in the case of personal loans excluding special circumstances.

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c. In the matter of recovery of loans, the Company shall not resort to undue harassment viz. persistently bothering the borrowers at odd hours, use of muscle power for recovery of loans, etc. The staff of the Company shall be adequately trained to deal with the customers in an appropriate manner so as to ensure proper behavior.

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d. The Company will call delinquent customers between 0900 hrs to 1800 hrs unless special circumstances of the borrower’s business require to call them otherwise outside the hours mentioned.