With a view to setting out Fair Lending Practices in a transparent manner, The Nainital Bank Ltd has decided to adopt the following as Lenders' Fair Practices Code.
The Fair Practices code applies to the following areas :
Applications for loans and their processing :
Standardised application forms for all categories of Loans irrespective of the amount of the loan sought, will be made available to the applicants on request, free of cost.
The Loan application forms shall be comprehensive and shall include information about the fees/charges, if any, payable for processing, the amount of such fees refundable in the case of non-acceptance of application, pre-payment options and any other matter which affects the interest of the borrower,
Receipt of completed application forms will be duly acknowledged. The applicant would also be intimated the approximate date by which the applicant should call on the Bank for preliminary discussions, if deemed necessary.
- All loan applications will be disposed of within a period of 4 weeks from the date of receipt of duly completed loan applications i.e. with all the requisite information/papers.
- In case of rejection of the loan application, the same would be conveyed in writing along with the main reasons which led to rejection of the loan application within the time frame as mentioned above
Loan appraisal and terms/conditions :
- In accordance with Bank's prescribed risk based assessment procedures, each loan application will be assessed and suitable margin/securities will be stipulated based on such risk assessment and Bank's extant guidelines, however without compromising on due diligence.
- The sanction of credit limit along with the terms and conditions thereof is to be conveyed to the loan applicant in writing and applicant's acceptance of such terms and conditions will be obtained in writing. Such terms and conditions as have been mutually agreed upon between the bank and borrower prior to the sanction will only be stipulated.
- Copy of loan documents, along with a copy of all relevant enclosures will be made available to the loan applicant on specific request. Standard sanction letter would include instances of approval, disallowance, etc. The bank is under no legal obligation to consider increase/additional limits/facilities without proper review/assessment.
- In case of lending under consortium arrangement, the participating banks would decide the timeframe to complete appraisal of the proposal and communication of the decision. The Bank will abide by the decision of the consortium. However, the RBI guidelines, if any, in this regard will prevail.
Disbursement of loans including changes in terms and conditions :
- Disbursment of loans sanctioned is to be made immediately on total compliance of terms and conditions including execution of loan documents governing such sanction.
- Any change in the terms and conditions, including interest rate and service charges, will be informed individually to the borrowers in case of account specific changes and in case of others by Public Notice/display on Notice Board at the branches/on the Bank's website/through Print and or other Media from time to time.
- Changes in interest rates and service charges will be effected prospectively.
- Consequent upon such changes any supplemental deeds documents or writings are required to be executed, the same shall also be advised. Further availability of facility will be subject to execution of such deeds documents or writings.
Post Disbursement supervision :
- Post disbursement supervision, particularly in respect of loans upto Rs.2 lacs, would be constructive with a view to taking care of any genuine difficulties that the borrower may face.
- Before taking a decision to recall/accelerate payment or performance under the agreement or seeking additional securities the Bank would give reasonable notice to the borrower.
- All securities pertaining to the loan would be released on receipt of full and final payment of the loans subject to any legitimate right or lien and set off for any other claim that the Bank may have against the borrowers. If such right is to be exercised, borrowers would be given due and proper notice with requisite details.
- The Bank would refrain from interference in the affairs of the borrower except for what is provided in the terms and conditions of loan sanction documents (unless new information, not earlier disclosed by the borrower, has come to the notice of the Bank as lender). However this does not imply that Bank's right of recovery and enforcement of security under Law as well as appointment of nominee directors, where required, is affected by this commitment.
- Bank will not discriminate on the grounds of gender, caste or religion in its lending policy and activity.
- In the case of recovery, Bank would resort to the usual measures as per laid down guidelines and extant provisions and would operate within the legal framework. In this context,
- In case of request for transfer of borrowal accounts, either from the borrower or from a Bank/Financial Institution, the Bank's consent or otherwise shall be conveyed within 21 days from the date of receipt of request.
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.
In case of complaints received, the branch would report the matter with full details within 7 days from date of receipt, to Regional/Head Office, who would take all necessary steps to redress and resolve the grievance/dispute, within a maximum period of 30 days.
In order to enhance value and relevance to the borrowers this code will be reviewed from time to time. The Bank would, therefore, greatly value any suggestions for improvement.