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What is the recent RBI directive for documents release to the borrowers?
The recent directive from the RBI instructs banks and financial institutions to promptly return original documents related to both immovable and movable assets within 30 days of a borrower’s full loan repayment.
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Are these guidelines applicable only to private banks?
No, these guidelines extend beyond private banks to include small finance banks, rural banks, and cooperative banks.
What are the consequences of failing to comply with RBI directive for documents release?
Failure to comply with the RBI’s directive will result in a daily fine of Rs. 5,000.
When should the original documents be returned to borrowers according to the RBI’s directives?
As per the RBI directive for documents release, banks, non-banking financial companies (NBFCs), or housing finance companies are obligated to return the original documents to borrowers within 30 days of the loan being fully repaid, adhering to fair practice standards.
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Do these regulations have a specific implementation date?
Yes, these regulations apply to all cases involving the release of property documents, both immovable and movable, after December 1, 2023.
Why did the RBI issue these directives?
The RBI issued these directives in response to complaints that financial institutions and banks were neglecting to return important documents to borrowers after loan payments were completed.
What provisions have been made in case of loss or damage to the original documents?
In the event of loss or damage to the original documents, the institutions are expected to assist borrowers in obtaining duplicate or certified copies, provide compensation, and cover related expenses.
Is there an extended timeframe for resolving cases involving loss or damage to documents?
Yes, an additional 30 days will be granted to the institutions to complete the necessary procedures in cases of loss or damage to documents, totaling 60 days for resolution.
Disclaimer:
The content provided in this web post is for informational purposes only and should not be construed as financial advice. Readers are encouraged to consult with financial professionals before making any significant financial decisions.
