RBI Update: RBI made major changes in the rules related to loan recovery, big relief for those who do not pay EMI...

When a common man takes a loan, it becomes a tension for that person, whereas the loan taken by the rich becomes a problem for the banks. If the common man is unable to repay the loan, he has been threatened by financial institutions. This is the reason why the Reserve Bank of India has made some strict laws regarding loan recovery by financial institutions.

These laws protect the interests of the common man while binding all financial institutions including banks under strict rules so that they cannot act arbitrarily. If you have taken a loan from the bank and have missed the installment payment, then the bank cannot act arbitrarily in the name of recovery. Nevertheless, many cases of arbitrariness of recovery agents keep coming to light across the country, hence it is important that you know well about these rules of RBI. So if any agent threatens you for loan money, then you know what legal rights you have.

After taking a bank loan, whenever a customer is unable to pay the installment on time, the bank sends him a notice asking him to deposit the money and in some cases, the recovery agents of the bank contact the customer. However, there are complaints against these agents regarding the methods of recovery. Recently, the Reserve Bank of India (RBI) imposed a fine of Rs 2.27 crore on private sector RBL Bank. This penalty has been imposed because the bank did not completely follow some of the necessary rules for recruiting loan recovery agents.

What is the rule of loan recovery?
Whenever you take a loan from any bank and if you do not pay 2 EMIs, the bank first sends you a reminder. But if you do not pay the 3rd installment, the bank will send you a legal notice and warn that if you do not make the payment, you will be declared a defaulter by the bank. At the same time, after the notice, the bank starts the recovery of the loan from the customer through the recovery agent.

What to do if a recovery agent threatens you?
If the loan recovery agents of the bank threaten you, you can directly file a police complaint.
Since non-payment of loan installment comes under the scope of civil dispute, hence no arbitrariness can be done to the defaulter. For loan recovery, the bank officer or recovery agent can call the defaulting customer only between 7 am to 7 pm. At the same time, the time to come home to recover the loan amount will also be the same. If bank officials or recovery agents break these rules, customers can complain to the police or RBI.

What are the guidelines of RBI?
To recover the loan amount, first of all, banks should inform the customers about the recovery agent or agency. The recovery agent will have to carry a copy of the bank's notice while contacting the customer. If a customer complains about a recovery agent, the bank will not be allowed to send recovery agents in related matters.

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