Reserve Bank of India Rules For Recovery Agents: Have you also taken a loan? And are troubled by calls from recovery agents day and night. Now a special proposal has been made by the Reserve Bank of India (RBI), after which the recovery agents will not be able to call you after 7 p.m. The Reserve Bank has become very strict regarding the standards of loan recovery.
The Reserve Bank of India (RBI) on Thursday proposed to tighten the standards for recovery of outstanding loans. Under this, financial institutions and their recovery agents cannot call borrowers before 8 a.m. and after 7 p.m.
Rules should be followed-
RBI's 'Draft Instructions on Risk Management and Code of Conduct' states that regulated entities (REs) like banks and NBFCs should not outsource key management functions. These functions also include policy formulation and determination of compliance with KYC norms and loan approval.
Code of conduct will be made-
RBI said that REs should ensure that their responsibilities towards customers are not diminished by outsourcing arrangements. According to RBI, banks and non-banking financial companies (NBFCs) should frame a code of conduct for direct selling agents (DSA), direct marketing agents (DMA), and collection agents. Regulated entities should ensure that DSAs, DMAs, and recovery agents are appropriately trained so that they discharge their responsibilities with sensitivity.
Recovery agents cannot threaten any debtor.
The central bank said that REs and their recovery agents will not resort to any form of threat or harassment, whether verbal or physical, against any person to recover the loan.
Agents will not be able to humiliate borrowers-
Along with this, recovery agents cannot publicly humiliate the borrowers nor interfere with their privacy.
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