With a view to setting out Fair Lending Practices in a transparent manner, Bank of Baroda has decided to adopt the following as Lenders Fair Practices Code.
The Fair Practices code applies to the following areas :
- List of Recovery Agents
- DRT - Nodal Officers at Corporate / Zonal / Regional Offices
- Collection of Dues and Repossession of Security
Applications for loans and their processing
Standard schedule of fee/ charges relating to the loan application depending on the segment to which the accounts belong will be made available to all the prospective borrowers in a transparent manner, along with the loan application, irrespective of the loan amount. Likewise, amount of fee refundable in the event of non-acceptance of the application, prepayment options and any other matter which affects the interest of the borrower will also be made known to the borrower at the time of application.
Receipt of completed application forms will be duly acknowledged.
The acknowledgement would also include the approximate date by which the applicant should call on the Bank for preliminary discussions, if deemed necessary.
All loan applications will be disposed of within a period of 4 weeks from the date of receipt of duly completed loan applications i.e. with all the requisite information/papers.
In case of rejection of loan application, irrespective of category of loans or threshold limits, the same would be conveyed in writing along with the main reason(s), which led to rejection of the loan application. The time frame for conveying the reason/s of rejection will be as per Schedule given below:
|Up to Rs.25000||Within 2 weeks|
|Above Rs.25000 and up to Rs.5.00 lac||Within 4 weeks|
|Above Rs.5.00 lac||Within 8-9 weeks|
|Non Priority Sector||Duration|
|Export Credit||Within 45 working days|
|Others||Within 46 working days*|
*The time frame is up to the level of Chairman and Managing Director. In case of proposals falling within the powers of the Management Committee of Board, the proposals are to be submitted at the next meeting scheduled to be held after the clearance by the Chairman and Managing Director.
The above time frame for disposal of applications is from the date of receipt of loan application, which is complete in all respects.
Loan appraisal and terms/conditions
In accordance with Bank prescribed risk based assessment procedures, each loan application will be assessed and suitable margin/securities will be stipulated based on such risk assessment and Banks extant guidelines, however without compromising on due diligence.
The sanction of credit limit along with the terms and conditions thereof is to be conveyed to the loan applicant in writing and applicants acceptance of such terms and conditions will be obtained in writing. Such terms and conditions as have been mutually agreed upon between the bank and borrower prior to the sanction will only be stipulated.
Copy of loan documents, along with a copy of all relevant enclosures will be made available to the loan applicant on specific request. Standard sanction letter would include instances of approval, disallowance, etc. The bank is under no legal obligation to consider increase/additional limits/facilities without proper review/assessment.
In case of lending under consortium arrangement, the participating banks would decide the timeframe to complete appraisal of the proposal and communication of the decision. The Bank will abide by the decision of the consortium.
Disbursement of loans including changes in terms and conditions
Disbursement of loans sanctioned is to be made immediately on total compliance of terms and conditions including execution of loan documents governing such sanction.
Any change in terms and conditions, including interest rate and service charges, will be informed individually to the borrowers in case of account specific changes and in case of others by Public Notice/display on Notice Board at the branches/on the Banks website/through Print and or other Media from time to time.
Changes in interest rates and service charges will be effected prospectively.
Consequent upon such changes any supplemental deeds documents or writings are required to be executed, the same shall also be advised. Further, availability of facility will be subject to execution of such deeds documents or writings.
Post disbursement supervision
Post disbursement supervision, particularly in respect of loans upto Rs. 2 lacs, would be constructive with a view to taking care of any genuine difficulties that the borrower may face.
Before taking a decision to recall/accelerate payment or performance under the agreement or seeking additional securities the Bank would give reasonable notice to the borrower.
All securities pertaining to the loan would be released on receipt of full and final payment of the loans subject to any legitimate right or lien and set off for any other claim that the Bank may have against the borrowers. If such right is to be exercised, borrowers would be given due and proper notice with requisite details.
Other general provisions
The Bank would refrain from interference in the affairs of the borrower except for what is provided in the terms and conditions of loan sanction documents (unless new information, not earlier disclosed by the borrower, has come to the notice of the Bank as lender). However this does not imply that Banks right of recovery and enforcement of security under Law as well as appointment of nominee directors, where required, is affected by this commitment.
Bank will not discriminate on the grounds of gender, caste or religion in its lending policy and activity.
In the case of recovery, Bank would resort to the usual measures as per laid down guidelines and extant provisions and would operate within the legal framework. Bank is already having a Model Policy on Code for Collection of Dues and Repossession of Security.
In case of request for transfer of borrowal accounts, either from the borrower or from a Bank/Financial Institution, the Banks consent or otherwise shall be conveyed within 21 days from the date of receipt of request.
Complaints : In case of any complaint/grievance, the applicant/borrowers will have to inform in writing the concerned branch. The Branch Officials shall immediately take up the matter for redressal.
Redressal : In case of complaints received, the branch would report the matter with full details within 7 days from date of receipt, to Regional/Zonal Head, who would take all necessary steps to redress and resolve the grievance/dispute, within a maximum period of 30 days.
In order to enhance value and relevance to the borrowers this code would be under review from time to time. The Bank would, therefore, greatly value any suggestions for improvement.