Fair Practices Code

1. Transparency in Interest Rates & Charges

• Date of Disbursement: Interest must be charged strictly from the date of actual disbursement of funds to the customer, not from the date of loan sanction or the date of handing over a cheque.
• Pro-rata Calculation: For loans disbursed or repaid mid-month, interest must be charged only for the actual number of days the loan was outstanding, rather than for the entire month.
• Advance Instalments: If any advance instalments are collected, the full loan amount cannot be considered outstanding for the entire duration covered by those instalments.
• Prospective Changes: Any changes in terms and conditions, including interest rates and service charges, will be communicated individually to borrowers in the case of account-specific changes. Other changes will be communicated through public notices, branch notice boards, the Bank’s website, print media, or other media from time to time.

2. Application & Processing

• Application Acknowledgment: The Bank provides an explicit acknowledgment of receipt for all loan applications.
• Processing Timeframe: Applications must be processed within a reasonable period. If additional documents or details are required, the borrower must be informed promptly.
• Non-Discrimination: The Bank does not discriminate against applicants on the grounds of sex, caste, or religion. However, participation in government-sponsored credit-linked schemes for weaker sections is permitted.
• Loan Agreements: A copy of the loan agreement, along with all enclosures referred to in it, must be provided to the borrower at the time of sanction or disbursement.

3. Post-Disbursement Supervision & Security

• Recall of Loans / Additional Security: Before recalling a loan, accelerating repayment, or demanding additional security, the Bank must provide advance notice as stipulated in the loan agreement or within a reasonable period.
• Release of Securities: All original securities and title deeds must be released immediately upon full repayment of the loan, unless the Bank has a legitimate right of set-off or lien for other dues. In such cases, full particulars must be communicated to the borrower.
• Transfer of Account: Requests by borrowers to transfer a loan account to another bank or financial institution must be answered or consented to within 21 days of receiving the request.

4. Ethical Recovery & Grievance Redressal

• Prohibition of Harassment: The Bank and its recovery agents must refrain from undue harassment, including calling borrowers at inappropriate hours or using physical force or intimidation.
• No Unwarranted Interference: The Bank must not interfere in the day-to-day affairs of borrowers except as provided for in the loan agreement, unless new and previously undisclosed material information comes to light.
• Internal Grievance Redressal: If a borrower faces any issue or problem, the Bank’s loan officials will address the grievance on priority and endeavour to resolve it promptly.
• Online Grievance Redressal: The Bank has also provided a link on its website for submitting grievances.
• Loan Application Disposal: All duly completed loan applications, along with the requisite information and documents, will be disposed of within four weeks from the date of receipt.
• Rejection of Loan Applications: If a loan application is rejected, irrespective of the loan category or threshold limit, the applicant will be informed in writing, along with the main reason(s) for rejection.
• Periodic Review: To enhance the value and relevance of this Code for borrowers, the Bank will review it from time to time and welcomes suggestions for improvement.