It will now be mandatory for banks and NBFCs to return the registry documents to the borrowers within 30 days of repaying the loan. The new rule of RBI will be applicable to Regional Rural Banks, Co-operative Banks, Commercial Banks, Asset Reconstruction Companies and NBFCs.
RBI Order: Reserve Bank of India has made major changes in the rules related to loans. RBI has also issued an order in this regard on Wednesday. According to which now banks will have to return the originals of the registry within 30 days of the borrowers repaying the loan. If this is not done, banks, NBFCs or housing finance companies will have to pay a fine of Rs 5,000 per day. Borrowers will benefit the most from this decision of the Central Bank, they will not have to make repeated trips to the bank to get the property documents.
What did RBI say in the order?
The new RBI rule will be applicable to regional rural banks, co-operative banks, commercial banks, asset reconstruction companies and NBFCs. The order also states that customers will be provided the facility to collect the documents as per their convenience or from the branch related to the loan.
Banks have also been instructed to provide a date and place for return of all documents in the sanction letter. If the borrower dies, his heirs will have to return the documents, which will be the responsibility of the regulated entities. Besides, information about this process will also have to be uploaded on the online website.
Banks will have to do this work if documents are lost
The Central Bank has also said in the order that if the bank or other regulated entities lose the registry papers or original documents. So in this situation, the concerned institutions will have to help the customers in getting the documents issued again.
What is the reason for the decision?
RBI has taken this decision due to repeated complaints. In fact, many disputes have arisen due to delay in providing property documents by banks and NBFCs. Not only this, cases have also come to light by filing cases in this regard.
Let us tell you that till now RBI has taken many steps for the benefit of the borrowers. Recently the Central Bank had issued an order regarding Penalty. Also, banks were instructed to behave appropriately with the borrowers.
