COLLECTION OF DUES AND REPOSSESSION OF SECURITY
1. Introduction : The debt
collection policy of the bank is built around dignity and respect to
customers. Bank will not follow policies that are unduly coercive in
collection of dues. The policy is built on courtesy, fair treatment
and persuasion. The Bank believes in following fair practices with
regard to collection of dues and repossession of security and
thereby fostering customer confidence and long term relationship.
The repayment schedule for any loan sanctioned by
the bank will be fixed taking into account paying capacity and cash
flow pattern of the borrower. The bank will explain to the customer
upfront the method of calculation of interest and how the Equated
Monthly Installments (EMI) or payments through any other mode of
repayment will be appropriated against interest and principal due
from the customers. The bank would expect the customers to adhere to
the repayment schedule agreed to and approach the bank for
assistance and guidance incase of genuine difficulty in meeting
repayment obligations. Bank's Security Repossession
Policy aims at recovery of dues in the event of default and is not
aimed at whimsical deprivation of the property. The Bank would set
in motion repossession procedure only after all attempts by the bank
to discuss with the borrower the ways and means to overcome the
financial hurdles have failed. The policy recognizes fairness and
transparency in repossession, valuation and realization of security.
All the practices adopted by the bank for follow up and recovery of
dues and repossession of security will be inconsonance with the law.
2. General Guidelines : All the members of the
staff or any person authorized to represent our bank in collection
or/and security repossession would follow the guidelines set out
below :
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The customer would be contacted ordinarily at
the place of his/her choice and in the absence of any specified
place, at the place of his/her residence and if unavailable at
his/her residence, at the place of business/occupation.
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Identity and authority of persons authorized to
represent bank for follow up and recovery of dues would be made
known to the borrowers at the first instance. The bank staff or
any person authorized to represent the bank in collection of
dues or/and security repossession will identify himself/herself
and display the authority letter issued by the bank upon
request.
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The bank would respect privacy of its borrowers.
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The Bank is committed to ensure that all written
and verbal communication with its borrowers will be in simple
business language and bank will adopt civil manners for
interaction with borrowers.
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Normally the bank's representatives will contact
the borrower between 0700 hrs and 1900 hrs, unless the special
circumstance of his/her business or occupation requires the bank
to contact at a different time.
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Borrower's requests to avoid calls at a
particular time or at a particular place would be honored as far
as possible.
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The bank will document the efforts made for the
recovery of dues and the copies of communication set to
customers, if any, will be kept on record.
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All assistance will be given to resolve disputes
or differences regarding dues in a mutually acceptable and in an
orderly manner.
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Inappropriate occasions such as bereavement in
the family or such other calamitous occasions will be avoided
for making calls/visits to collect dues.
3. Giving notice to borrowers
While written communications telephonic reminders or visits by the
bank's representatives to the borrowers place or residence will be
used as loan follow up measures, the bank will not initiate any
legal or other recovery measures including repossession of the
security without giving due notice in writing. The service of demand
notice will be made by delivering or transmitting to the borrower of
his agent, by Registered Post with acknowledgement due, or by Speed
Post or by Courier or by any other means of transmission of
documents like fax message or Electronic Mail service. Bank will
follow all such procedures as required under law for
recovery/repossession of security. The borrower will be given due
notice as required under the prevailing laws which includes Notice
of 60 days from the dispatch of notice under the provisions of Sec.
13(2) to pay the debt failing which the bank will proceed to take
possession of the asset. 4. Repossession of
Security Repossession of security is aimed at
recovery of dues and not to deprive the borrower of the property.
The recovery process through repossession of security will involve
repossession, valuation of security and realization of security
through appropriate means. All these would be carried out in a fair
and transparent manner. Repossession will be done only after issuing
the notice as detailed above. Due process of law will be followed
while taking repossession of the property. The bank will take all
reasonable care for ensuring the safety and security of the property
after taking custody, the ordinary course of the business.
5. Valuation and Sale of Property Valuation
and sale of property repossessed by the bank will be carried out as
per law and in a fair and transparent manner. Sale of property is to
be caused by giving a notice of thirty days to the borrower /
guarantor after taking possession of the property. The notice will
contain time, date and venue of the auction and reserve price, if
the sale is intended to be conducted by holding public auction. In
case, the sale is proposed to be made by private treaty or any other
method, the borrower will be intimated reserve price, provided that
if the sale of such secured asset is being effected by either
inviting tenders from the public or by holding public auction, the
sale notice has to be published in two leading newspapers, one of
which must be in vernacular.
The bank will have right to recover from the
borrower the balance due if any, after sale of property. Excess
amount if any, obtained on sale of property will be returned to the
borrower after meeting all the related expenses provided the bank is
not having any other claims against the customer i.e. the Bank will
be at liberty to exercise right of general lien meaning thereby that
until payment is made to the bank of all the amounts, whether past,
present or future, actual or contingent which may be payable by the
borrower or for which the borrower may be or become liable hereunder
or otherwise and whether as principal or surety.
6. Opportunity for the borrower to take back the
security As indicated earlier in the policy
document, the bank will resort to repossession of security only for
the purpose of realization of its dues as the last resort and not
with intention of depriving the borrower of the property.
Accordingly the bank will hand over possession of property to the
borrower any time after repossession and before concluding sale
transaction of the property, provided the bank dues are cleared in
full. The possession of property will be given within 60 days from
the date of clearance of Bank's all updated dues and after
completing all formalities therefore.
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