Practices Code For Lenders
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:
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.
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
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
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:
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
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
loans sanctioned is to be made immediately on total compliance of
terms and conditions including execution of loan documents governing
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.
interest rates and service charges will be effected prospectively.
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:
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.
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 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.
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.
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.
Fair Practices Code For Lenders