The Banking Codes and Standards Board of India has issued a directive to all its commercial member banks to be more transparent with regards to retail loans.

Few specific directives that loan seekers should be aware of are:

1. Inform all those who avail Floating rate home loans, of the reference rate to which the floating rate is anchored.

2. Real time update of any change in the above mentioned anchor rate on the bank's websites.

3. Clearly state the segments and quantum/structure of charges. Nothing can be charged which is not mentioned in the public domain.

4. Banks will now have to explain the Income Tax implications for interest income and also obtain form 15G/H at the time of term deposit account opening.

5. Also bank's cannot insist on an insurance cover for the securities lodged

6. All customer queries to be resolved in a maximum of 30 days

7. Come out with Most Important Terms and Conditions (MITC) for loans and credit cards

8. BCSBI will start its credit counselling services at BKC from 1st Oct 2009. This will be free for any consumer- retail or enterprise.

Our View

We at Deal4Loans, welcome these recommendations and hope that this will lead to a stronger & stable credit environment.
The Credit counselling services are a welcome move. We have long advocated the need for this and infact have been running such a free service for the last 3 years under ASK AMITOJ