Jagran Bureau, New Delhi. Recovery agents nominated by all the financial institutions of the country (banks, rural banks, NBFCs, housing finance companies, co-operative banks etc.) run by RBI will no longer behave rudely with the customers who are unable or delay in repaying the loan under any circumstances.
The Reserve Bank of India (RBI) on Thursday issued new guidelines regarding detailed loan recovery and appointment of recovery agents in this regard. Its main objective is to protect customers who are unable or delayed in repaying the loan from undue pressure.
Banks will have to make a clear policy
RBI has clarified that banks will now have to make a clear policy, which includes qualification, investigation, code of conduct and monitoring of recovery agents. This will especially provide relief to those who face harassment during recovery.
Now banks have to ensure that the recovery process is not only legal but also humane. Complaints about illegal and inhumane behavior of recovery agents were continuously increasing for the last several years. In many cases, agents threatened customers, abused them, harassed family, or even threatened physical violence.
In some reports, such cases have come to light where customers even committed suicide under the pressure of recovery. For example, in 2023-2024, there were reports from many states where recovery agents of microfinance loans harassed women and farmers so much that they were forced to take extreme measures.
What kind of agents will be appointed?
Firstly, banks have to check the qualifications and background of recovery agents before appointing them. It will be mandatory for the agents to obtain Debt Recovery Agent training certificate from the Indian Institute of Banking and Finance (IIBF) or its affiliated institutions.
The bank will have to formulate a code of conduct, which will include both agents and bank employees. Before appointing agents, written consent will have to be taken from them that they will follow the policies of the bank. If an agent breaks the rules, the bank will have to take punitive action against him, including termination of the contract.
For the convenience of customers, banks will now display the updated list of recovery agents on their websites, mobile apps and branches. This will include the agents' names, contact details and the duration of the contract. If an agent's contract ends, the bank must immediately issue a public notice so that customers can avoid dealing with him.
Customer information will remain confidential
Recovery for microfinance loans will be at a fixed location, but can be done at home or workplace if the customer does not turn up twice. All calls will be recorded, and the customer will be informed that the conversation is being recorded.
There is a complete ban on harsh behaviour. Agents or employees may not use abuse, threats, false information or threats of physical violence. Sending inappropriate messages or harassing family or friends on social media is prohibited.
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