Thankfully banking options are plenty in our Country, thereby it gives options and freedom to any loan seeker to compare, negotiate and choose his comfort level. Likewise the banks have the option to entertain or refuse any loan application if the same is not falling under their required parameters.
However recently it has been observed that banks, especially private banks charge extremely high foreclosure charges which are causing a huge burden on the traders and industrialists while planning a bank change offering favourable banking facilities or closure from their own funds.
On this issue, Vidarbha Taxpayers Association (VTA) dispatched memorandum to Narendra Modi – Prime Minister, Nirmala Sitharaman – Union Finance Minister, Shaktikanta Das – Governor RBI, Dr. Neena Rohit Jain – Ombudsman RBI, Mumbai and Sangeeta Lalwani – Regional Director, RBI Nagpur with a request to regulate banks of foreclosure charges. VTA also attempted for an appointment with RBI Nagpur, but probably due to their restrictive protocol couldn’t materialize.
Shrawankumar Malu – President VTA said fraction of percentage makes a huge impact on any business house especially after major adverse impact on business due to pandemic and money saved is money earned. It is absolutely admitted that banks need some years of lock-in period else account holders will keep jumping from one bank to another, hence some lock-in period as per loan character can be fixed and thereafter give option to the account holders to choose bank as per favourable options available.
It has also been observed that even the MSME are also being misguided by banks Regarding Foreclosure charges by unethical means. Banks collect MSME/Udyog Aadhar certificates at time of application but do not pass on the benefits at foreclosure for the same stating unreasonable/unethical statements as Misuse of terms “FIXED” “REDUCING” and “FLOATING” Rates & likewise.
Tejinder Singh Renu – secretary of VTA suggested that an officer should be designated in cities having population of 20 lacs and above to handle such foreclosure charge cases on topmost priority. Presently it is observed that few banks literally threaten such clients seeking foreclosure that the bank will harm their credit rating if they shift loans. Such an attitude is not good for our economy, when banks have the option to accept or refuse; likewise the taxpayers also deserve a free and fair option to choose banks which offer them better facilities.
On behalf of the taxpayers, VTA requests the Union Government, RBI and Ombudsman RBI to regulate such foreclosure charges taking into consideration the hardship being faced by the entrepreneurs, traders and industrialists and appoint an Ombudsman in every city having population of 20 lacs on more to handle such issues.