SOP Settlement Version 2

1. Internal document
Page 1 of 2
SOP Settlement
Details:
Process Settlement of Retail Asset Product
Date 14/12/2017
Version VER 2/Settlement/ 1217
Product All Retail and Rural Retail Banking
products serviced by Retail Asset
Collections.
Scope: Broadly define activities involved settlement like raising request for settlement,
validation of settlement with customer, approvals & issuance of settlement letter,
acknowledgement, receipt of payment.
Steps:
Sr.
No
Process Steps FPR Tentative TAT *
1 Collection Partner to seek a settlement request letter
/ email from registered email ID along with KYC
from the customer that necessarily consists of
o Acknowledgement of Loan
o Reason for default
o Request for waiver or settlement
Collection Partner to raise a request on Y-form
keeping his Section Leader, Regional Collection
Leader, Settlement Authorization Team members in
THROUGH Field.
The request raised on Y-form should contain the
following :
a. The Settlement Request from the customer
b. The settlement format which has reason for
settlement, amount of settlement and no. of
installments.
The Settlement has to be raised to the relevant
approving authority in the TO field.
Collection
Partner
As and when
required (T)
2 Settlement Authorization Team to check :
1. Credit bureau status
2. Outstanding checks on other loan accounts/ CC/
liability a/c’s
SAT T + 2
Settlement - Standard Operating Procedure (SOP)

2. Internal document
Page 2 of 2
SOP Settlement
LAS details & liquidation / Yes securities & Demat
account details.
3. In case of secured assets like CV/CE / AL etc.
check for approximate valuation on online sites.
Call the customer to ascertain:
1. Reason for settlement,
2. Credit Score impact
3. Enhancement of settlement.
Evaluate the proposal based on findings and accordingly
recommend or decline the settlement request.
3 Check for appropriate approving authority while
recommending the waiver. If not decline the request and
ask the team to re- raise the request to correct approval
authorities.
SAT T+3
4 For approved cases:
SAT team to raise the settlement letter and share with
Collection Partner.
Also confirm if NOC is to be released or held.
SAT T +4 ( Post
receipt of
approval of
settlement)
5 Collection Partner takes printout of the settlement letter
and submits the same to the customer. He collects an
acknowledgement copy along with settlement amount.
Acknowledgement letter is sent to the SAT team
Collection
Partner
T+4 ( post receipt
of settlement
letter)
6 Collection Partner/ Section Leader to inform SAT of
settlement amount being received and raises request for
loan closure and issuance of NOC.
SAT Post receipt of
payments
*The timelines are indicative. Actual timelines may differ from case to case / time to time, considering the
dependency on process steps, volumes, availability & accessibility of relevant authority, etc.
Special Mention
I. It has also been decided that henceforth, the officer/authority sanctioning a
compromise/one-time settlement should append a certificate stating that the
compromise settlements are in conformity with the RBI guidelines.
II. Once a case is filed before a Court/DRT/BIFR, any settlement arrived at with the
borrower is subject to obtaining a consent decree from the Court/DRT/BIFR concerned.
The net present value of the settlement amount should be calculated and this amount
should generally not be less than the net present value of the realizable value of
securities.