Bank Loan Recovery guidelines

1. Dos & DONTs IN RECOVERY
1. Debt recovery policy and procedure of banks are based on the RBI and
IBA guidelines for banks. These guidelines apply to debt recovery by bank
staff and the outsourced recovery agency.
2. Debt collection policy of a bank follows ;(a) dignity and respect to
customers (b) courtesy, fair treatment and persuasion in interactions
with customers © appropriate authorization to recovery agents (d)due
notice to the customers(e)document the disputes/resistance/threats etc.
of customers in recovery efforts(f)use simple business language in all
verbal/written communications with customers (g)keep privacy &
confidentiality of customer’s dues & other records (h)no misleading
statements or misrepresentation be made to customers(i)read,
understand and abide by the policy guidelines.

2. 3. Debt recovery processes/methods are of different kinds like (a)
normal recovery process where borrower is willing to pay the dues
smoothly without resistance (b)difficult recovery process where the
debtor is not willing to pay and resists/avoids recovery efforts © asset
possession process where recalcitrant borrower do not eventually pay
the dues and the movable assets charged to bank by way of
hypothecation or pledge can be possessed by bank or its recovery
agent and auctioned thereafter or otherwise sold to recover dues.(c)
legal recovery process where intervention of court is required to
possess the mortgaged immovable property by the bank or its recovery
agent. In case of debt being unsecured, the debtor will have to be sued
for recovery of dues by bank/ recovery agent.

3. Normal recovery process- (a) making customer calls
1. Calls be made from same number as advised by bank to customer.
2. Disclose identity & authority from bank at the first instance.
3. Contact between 0700 to 2100 hours.
4. Inappropriate occasions like bereavement in family be avoided.
5. All calls made be documented.
6. Customer’s questions be answered infull.
7. Once a promise is elicited, a call be made to serve as a reminder and for
confirmation of payment.
8. If commitment not honored, calls be made at reasonable frequency
based on amount owed.
9. If customer is not available during a few calls made, leave a message to
an adult in family like’ please leave a message that the agent(name) had
called and request the customer(name) to call agent (name) back at the
given phone number’.

4. (b) visiting customer
1. Customer will be visited only if he has not paid the due amount
within days of grace and dues are still outstanding/ debtor has been
notified of due amount and also the name of collection agent/the
collection agent has taken an appointment from debtor for visit.
2. During visit, the agent will be in proper dress and appearance/wear
the dress prescribed by bank.
3. Agent to greet customer with salutations, show his ID and then
start conversation. Visit from 0700 hours to 2100 hrs.
4. Agent to respect privacy of debtor and show due respect and
courtesy. Agent not to use threats or intimidation verbally/by body
language.
5. Conversation with debtor should be recorded on audio/video as per
bank policy regarding documentation.

5. DONTs
1. Don’t violate/breach the recovery policy/procedure of bank.
2. Don’t exceed the authority delegated.
3. Don’t call before 0700 hrs or after 2100 hrs.
4. Don’t make anonymous calls/bunched calls
5. Don’t conceal/misrepresent your ID.
6. Don’t show uncivil/indecent/uncouth behavior/language.
7. Don’t harass/humiliate/intimidate/threaten debtor.
8. Don’t intrude into the privacy of debtor’s family.
9. Don’t disclose debtor’s debts/dues/account information to unauthorized
persons.