What is the new rule of RBI order to banks

What is the new rule of RBI order to banks

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Original documents to be returned within 30 days of loan completion’ – Has RBI issued an order to banks, Original documents must be returned within 30 days of loan completion. In case of delay, the borrower shall be compensated at the rate of ₹5,000 for each day of delay, RBI directive to banks.

RBI has taken this action based on people’s complaints

The RBI has issued an order to banks to return original documents within 30 days of loan completion.

The order, which was issued in September 2023, applies to all banks and non-banking financial companies (NBFCs). It requires banks to release all original movable and immovable property documents to borrowers within 30 days of full repayment of the loan.

The order also states that banks must compensate borrowers at the rate of Rs 5,000 per day for any delay in releasing the documents beyond 30 days.

The RBI issued the order in response to numerous complaints from borrowers about banks holding back their original documents even after they had fully repaid their loans. This often caused borrowers inconvenience and hardship, as they were unable to sell or transfer their property until they had the original documents back.

The RBI’s order is a welcome step for borrowers, as it will ensure that they get their original documents back promptly after repaying their loans. It will also help to reduce customer grievances and disputes.

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