Business

RBI Advises Banks: Return Property Papers To Borrowers Within 30 Days Of Repayment Or Pay Rs 5k Per Day For Late Payment

On Wednesday, the Reserve Bank urged directed banks and financial institutions to release all original movable or immovable property documents and eliminate charges listed with any registration within 30 days of the borrower’s complete repayment of a loan.

In the event that Regulated Entities (REs) fail to comply with the directive, the RBI stated in a statement that the borrower would be compensated at the rate of Rs 5,000 for each day of delay.

RBI stated that REs use disparate practices in releasing such movable or immovable property documentation which leads to consumer complaints and disputes.

To ensure consistency, the RBI requested that “REs release all the original movable/immovable property documents and remove charges registered with any registry within a period of 30 days after full repayment/settlement of the loan account”.

In case of delay, it stated that the RE would notify the reasons for the delay to the borrower.

“The borrower shall be given the option of collecting the original movable/ immovable property documents either from the banking outlet/branch where the loan account was serviced or any other office of the RE where the documents are available, as per her/his preference”, the statement reads.

RBI went on to say, “The timeline and place of return of original movable/immovable property documents will be mentioned in the loan sanction letters issued on or after the effective date”.

To address the possibility of the sole borrower or joint borrower’s death, the RBI stated that REs must have a well-laid-out protocol for returning original movable/immovable property documents to the legal heirs.

This policy, along with other similar rules and procedures for consumer information, would be disclosed on REs’ website, it noted.

In case of loss or damage to original movable/immovable property documents, the notification said that REs would help the borrower in acquiring duplicate/certified copies of such documents and would shoulder the associated costs in addition to compensating the borrower.

“However, in such cases, an additional time of 30 days will be available to REs to complete this procedure, and the delayed period penalty will be calculated thereafter (i.e., after a total period of 60 days)”, the RBI continued.

The RBI further stated, “The compensation provided under these directions would be without prejudice to the rights of a borrower to get any other compensation as per any applicable law”.

“These directions would be applicable to all cases where the release of original movable/ immovable property documents falls due on or after December 1, 2023”, the RBI added.

Also read: Vladimir Putin Promises Kim Jong Un To Help North Korea In Developing Satellites

Spriha Rai

Recent Posts

Police Arrest Two In Fake Marriage Certificate Racket In Name Of Arya Samaj

DCP Nagar Abhishek Bharti revealed that five couples, including Shivani and Shrikant Yadav, recently filed…

33 mins ago

India And Nigeria Strengthen Counter-Terrorism Cooperation In Second Strategic Dialogue

Doval and Ribadu held detailed talks on challenges linked to terrorism and radicalization, including those…

1 hour ago

Ola Electric’s Share Hits All-Time Low Of Rs 74 Ahead Of Q2 Results

Analysts predict that the stock could drop closer to the Rs 70 mark. Ola Electric…

2 hours ago

US Election: Voting Begins With First Ballots Cast In New Hampshire

This election is one of the most divisive in US history. Harris and Trump have…

2 hours ago

Waqf Bill: Opposition MPs Meet LS Speaker, Lodge Protest Against JPC Chairman Jagdambika Pal

Opposition members alleged that Pal calls JPC meetings without consulting them and restricts their opportunity…

3 hours ago

Delhi HC Rejects Khalid Saifi’s Plea To End Attempted Murder Case In 2020 Riots

The Delhi Police opposed Saifi’s bail, citing evidence from WhatsApp messages exchanged among the accused.…

3 hours ago