The
Reserve Bank
of India (RBI)
gave a recent
directive
to develop
Indian banks.
The Reserve
Bank of India
has asked
banks to be
fair and transparent
while their
signing of
loan agreements
with consumers.
The RBI directive
on home loans
for resident
Indians have
followed the
hue and cry
raised by
various sections
of consumers
with regard
to housing
loans. RBI
directive
on home loans
has insisted
that while
giving a home
loan, banks
should not
combine their
loans with
their own
prime lending
rates (PLR),
which often
leads to pro-bank
and cons the
interest of
consumers.
The recent
RBI directive
on home loans
has also insisted
that consumers
must receive
good credit
advice before
signing a
loan agreement.
The banks
themselves
can provide
credit counseling’s
or it can
also be provided
by non-governmental
organizations.
Often consumers
cried foul
for not receiving
benefits under
the interest
rate in floating
rate loans
with their
key lending
rates or DPP
and, hence,
even if rates
dive down
banks kept
the DPP unchanged.
On the other
hand, when
interest rates
sky rocket,
banks increase
the reference
rate, making
customers
pay a higher
rate and,
therefore,
increase the
number of
EMIS. The
RBI has directed
banks to modify
these illogical
rules.
Thus, the
RBI develops
guidelines
for home loans
which are
intended to
make the process
of home loan
more logical
and transparent.
The detailed
guidelines
for Home Loan,
RBI points
out those
borrowers
should ask
the exact
mandate and
the EMI while
taking a loan
at a fixed
rate. The
RBI has also
promised to
probe into
all complaints
from consumers
if it is purchased
by the regulatory
agency’s
notice.
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