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Fair Practice Code
The Fair Practices Code (“FPC”) has been devised by Capital Trust Limited (“CTL” or “Company”) in accordance with Master Directions RBI/2015-16/16 DNBR (PD) CC.No.054/03.10.119/2015-16 Dated July 01, 2015 issued by The Reserve Bank vide its circular dated September 28, 2006 and subsequent amendments, on Fair Practices Code (FPC) for all NBFCs to be adopted by them while doing lending business. The guidelines inter alia, covered general principles on adequate disclosures on the terms and conditions of a loan and adopting a non-coercive recovery method.
CTL has put in place the FPC with an endeavor to achieve synchronization of best practices when the Company is dealing with its stakeholders such as customers, employees, vendors, etc. The Company’s Fair lending practices shall apply across all aspects of its operations including marketing, loan origination, processing, and servicing and collection activities. CTL’s commitment to the FPC would be demonstrated in terms of employee accountability, monitoring and auditing programs, training and technology. The Company’s Board of Directors and the management are responsible for establishing practices designed to ensure that its operations reflect a strong commitment to fair lending and that all employees are aware of that commitment.
The essence of the FPC lies in the following aspects that CTL shall strive to follow in spirit and in letter: ➢ To provide professional, efficient, courteous, diligent and speedy services.
➢ Not to discriminate on the basis of religion, caste, sex, descent in any manner.
➢ To be fair and honest in any advertisement and marketing of loan products.
➢ To provide customers with accurate and timely disclosure of terms, costs, rights and liabilities as regards loan transactions.
➢ If sought, to provide such assistance or advise to customers seeking loans.
➢ To attempt in good faith to resolve any disputes or differences with customers by setting up complaint redressal system within the organization.
➢ To comply with all the regulatory requirements in good faith.
➢ Seek to use governance structures that provide appropriate levels of oversight in the areas of audit, risk management and potential conflicts of interest and to implement compensation and other policies that align the interests of owners and management.
➢ Seek to confirm that the funds do not flow to companies that utilize child or forced labor or generally maintain discriminatory policies against religion or gender.
➢ Ensure compliances relating to Indian regulations prescribed by the Reserve Bank of India (‘RBI’)
Guidelines on Fair Practice Code For CTL
(I) Applications for loans and their processing
- All communications to the borrower are in the English language or a vernacular language.
- Loan application includes necessary information which affects the interest of the borrower, so that a meaningful comparison with the terms and conditions offered by other NBFCs can be made and informed decision can be taken by the borrower.
- The loan application also indicates the documents required to be submitted with the application form.
- The CTL is giving acknowledgement for receipt of all loan applications. The time frame within which loan applications will be disposed of is also indicated in the acknowledgement.
- The customer would be explained the processes involved till sanction and disbursement of loan and would be notified of timeframe within which all the processes will be completed ordinarily.
(II)Loan appraisal terms and conditions
- CTL shall scrutinize the information submitted by the customer and additional data, if any, required should be called promptly to facilitate expeditious disposal of the loan.
- CTL shall convey in writing all customers of CTL by means of Sanction letter or any other form of written communication key terms and conditions of the proposed exposure including:
- the amount of loan sanctioned along with the terms and conditions including annualized rate of interest,
- details of the interest and other charges payable by the customers in relation to their loan account
- acceptance of terms and conditions and other caveats governing the credit given by CTL arrived at after negotiation
- all other information which is relevant from the point of view of the loan to be provided and all the parties involved.
- wherever possible, reasons for rejection of loan would be conveyed to the customers.
- CTL shall furnish a copy of the loan agreement in Vernacular language along with copy of all relevant enclosures quoted in the loan agreement to all the borrowers at the time of sanction/disbursement of the loan and shall be duly approved by the customer and countersigned by the authorized officials of CTL.
- All the information about customer, loan agreements, terms and conditions of the loan and other documents shall also available on the secured app which is accessible to the customer.
(iii) Disbursement of loans including changes in terms and conditions
- All the disbursements shall be in the bank account of the customers.
- CTL shall give notice regarding any change in the terms and conditions including disbursement schedule, interest rates or other charges etc.
- Changes in the interest rates and charges shall be effected prospectively.
- A suitable condition in this regard shall be incorporated in the loan agreement, as applicable.
- Decision to recall / accelerate payment or performance under the agreement should be in consonance with the loan agreement. Before taking a decision to recall / accelerate payment or performance under the agreement or seeking additional securities, CTL shall give notice to customers in consonance with the loan agreement.
- All communication like acceptances (including for amendments or addendum) with the Customer in relation to the sanction / facilities / loan / mandate / proposals shall be in writing
- CTL will not interfere in the affairs of the borrower except for the purposes provided in the terms and conditions of the loan agreement (unless information, not earlier disclosed by the borrower, has been noticed).
- If the customer does not adhere to repayment schedule, a defined process in accordance with the laws of the land will be followed for recovery of dues. The process will involve reminding the customer by sending the notice or by making personal visits and/ or repossession of security, if any. CTL shall ensure that its process of recoveries will not involve harassment to the Customer. Appropriate instructions will be provided by CTL to its staff for handling customer queries and grievances cordially.
- In case of receipt of request from the borrower for transfer of loan account, the consent or otherwise i.e. objection from CTL, if any, should be conveyed within 21 days from the date of receipt of request. Such transfer shall be as per transparent contractual terms in consonance with law.
- In accordance with circular no. DNBS(PD). CC. No. 399/03.10.42 /2014-15 dated July 14, 2014 issued by RBI to ensure customer protection and to bring in uniformity about prepayment of various loans by borrowers of banks and NBFCs, CTL shall not charge foreclosure charges/ pre-payment penalties on all floating rate term loans sanctioned to individual borrowers.
- All the fees / charges / interest would be payable as per interest rate policy or as per mutually agreed terms.
- The Company will mention the penal interest charged for late repayment in bold in the loan agreement.
- CTL will consider cases of financial difficulty appropriately. The customer should identify problems and immediately should let DMI know as soon as possible.
- All personal information of the customer would be confidential and would not be disclosed to any third party unless agreed to by the customer in writing. The term ‘Third party’ excludes all Law enforcement agencies, Credit Information Bureau, RBI, other banks and financial institutions and any other state, central or other regulatory body.
Customer information would be revealed only under the following circumstances, namely;
- If CTL is compelled by law
- If it is in the Public Interest to reveal the information
- If the interest of DMI to require disclosure.
(V)Responsibility of Board of Directors
The Board of Directors of CTL has laid down grievance redressal mechanism within the organization as per details mentioned in the next paragraph. Such a mechanism ensures that all disputes arising out of the decisions of CTL’s functionaries are heard and disposed of at least at the next higher level. The Board of Directors of CTL shall annually review the compliance of the FPC and the functioning of the GRM. A consolidated report of compliance shall be submitted to the Board every year.
(vi) Language and mode of communicating FPC
- FPC as established by CTL has been established in English language and is based on the guidelines as outlined by the RBI.
- CTL shall provide the copy of its FPC in regional/vernacular languages for customers who demand copy of the same.
(vii) Regulation of excessive interest rates charged
- CTL will disclose to the borrower the risk and rationale for charging different rate of interest to different categories of borrowers in the application form and explicitly communicated in the sanction letter.
- The rates of interest and approach for gradation of risk shall also be made available on the website of CTL.
- The rate of interest being charged by CTL shall be annualized rate to make the customer aware of the exact rates that would be charged to the account.
(VIII) Complaints about excessive interest rates charged
Boards of CTL shall lay out appropriate internal principles and procedures in determining interest rates and processing and other charges.
Grievance Redressal Mechanism
Customers who wish to provide feedback or send in their complaint may use the following channels between 9:00 am and 6:00 pm from Monday to Saturday (except on national holidays).
♦ Call on +91 9899484116
♦ Email us at email@example.com
♦ Write to us at the below mentioned address:
Capital Trust Limited
366 Sultanpur, M G Road, New Delhi- 110030
In case the complaint is not resolved within the given time or if he/she is not satisfied with the solution provided by the company, the customer can approach the Complaints Redressal Officer. Name and details of Compliant Redressal Officer is as follows:
Mr. Nitesh Verma
Tel. No: 9999074312
Email Id: firstname.lastname@example.org
If the complaint/dispute is not redressed within a period of one month, the customer may appeal to Officer-in-Charge of the Regional Office of Department of Non-Banking Supervision of RBI under whose jurisdiction the Registered Office of the Capital Trust falls.
The details of DNBS are as given below:
The General Manager,
Department of Non-Banking Supervision,
Reserve Bank of India,
6, Sansad Marg
New Delhi – 110 001
Email id: email@example.com