Manda­tory 30-Day Loan Dis­bur­sal Time

Consumer Voice - - Personal Loans -

The Re­serve Bank of In­dia (RBI) has come down heav­ily on com­mer­cial banks for caus­ing in­or­di­nate de­lays in con­vey­ing their credit de­ci­sions/credit dis­bur­sal. In its lat­est no­ti­fi­ca­tion dated 1 Septem­ber 2014, all banks have been asked to carry out due dili­gence be­fore ar­riv­ing at credit de­ci­sions to en­sure timely and ad­e­quate avail­abil­ity of credit. RBI has said that banks must put in place loan dis­bur­sal time­lines within 30 days of the RBI cir­cu­lar. Banks are also ex­pected to make suit­able dis­clo­sures on the time­lines for con­vey­ing credit de­ci­sions through their web­sites, no­tice boards, prod­uct lit­er­a­ture, etc. Lead­ing bankers have opined that this move could push banks to cut pro­ce­dural de­lays. They say that in­di­vid­ual banks al­ready have their own in­ter­nal guide­lines and time­lines for dis­posal of small loans. A cen­tral­ized sys­tem as sug­gested by RBI will help in speed­ing up mat­ters. Un­der the RBI guide­lines on Fair Prac­tices Code for lenders, it has been stip­u­lated that the time frame for dis­posal of loan ap­pli­ca­tion up to Rs 200,000 should be in­di­cated at the time of ac­cept­ing the loan ap­pli­ca­tion.

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