Fair Practice Code - English
Fair Practice Code
1. Introduction
The Company plans to follow over a period of time, a product agnostic approach focusing on meeting the credit and on a later stage (by acquiring applicable licenses/ or in partnership with other FIs) investment and protection requirements of the self-employed customer segment in India with homes as a primary security except in very select cases; limited lending would be also done against commercial property. We intend to be a one stop shop for financial services for the self-employed customer segment for all their needs. Our strengths lie in understanding home security across the states in India (where we intend to operate in) along with assessing substantially accurately cash flows of our borrowers, to assess capability of repayment in a time span which suits their assessed cash flows.
The Reserve Bank of India (RBI) has issued revised circular no. RBI/2015-16//16 DNBS (PD) CC No. 054 / 03.10.119/ 2015-16 dated July 01, 2015 and RBI/DNBR/2016-17/45 Master Direction DNBR. PD. 008/03.10.119/2016-17 September 01, 2016 (Updated as on February 17, 2020) on Guidelines on Fair Practice Code for Non-Banking Financial Companies (NBFC)s thereby setting standards for fair business and corporate practices while dealing with their customers.
The Fair Practice Code, as adopted herein below, is in conformity with the Guidelines on Fair Practice Code for NBFCs as contained in the aforesaid RBI Circular(s)/Direction(s). This fair practice code shall be displayed at all the Branches/office premises in the vernacular language and shall also be placed on the company’s website. As a result, Sahayya Finserve Private Limited has framed the comprehensive Fair Practice Code which is covered in this document.
The Company will ensure that the implementation of the FPC is the responsibility of the entire organization. The Company’s fair lending practices shall apply across all aspects of its operations including marketing, loan origination, processing, and servicing and collection activities. Its commitment to FPC will be demonstrated in terms of employee accountability, training, counselling, and monitoring, auditing programs and internal controls, and optimal use of technology.
The Company’s Board of Directors and the management team are responsible for implementing the fair practices hereinafter detailed, and also to ensure that its operations reflect its strong commitment to all the stakeholders for offering in a fair and equitable manner, the various financial services and products including lending and that all employees are aware of this commitment.
2. Scope and Objective
The code has been developed with an objective of ensuring fair practices while dealing with all its customers, enable greater transparency and helping our customers in having a better understanding of the product and taking informed decisions.
This Fair Practices Code applies to the following categories of products and services offered by us (currently offered or which will be introduced at a future date):
Loans, guarantees and other products in the nature of financial assets.
Products offered through a network consisting of the branches of the Company, its subsidiaries and associates.
Products/services provided physically, over the phone, on the internet or by any other method whatsoever, existing or futuristic
3. Applications for loans and their processing
- All communications to the borrower shall be in the vernacular language or a language as understood by the borrower.
- The Loan application forms of the Company will include necessary information which affects the interest of the borrower, so that a meaningful comparison with the terms and conditions offered by other NBFCs can be made and informed decision can be taken by the borrower. The loan application form will indicate the documents required to be submitted with the application form.
- The Company will have a system of giving acknowledgement for receipt of loan applications. The time frame within which loan applications will be disposed of will be indicated in the acknowledgement. The acknowledgment may be done through manual or electronic means.
4. Loan appraisal, disbursements and terms / conditions
The Company will convey in writing to the borrower in a language as understood by the borrower by means of sanction letter or otherwise, the amount of loan sanctioned along with the terms and conditions including annualised rate of interest and method of application thereof and keep the acceptance of these terms and conditions by the borrower on its record. The Company will mention the penal interest in bold which will be charged for late repayment and / or any other default on the part of the customer, in bold in the loan agreement. The Company will follow a transparent mechanism to convey to the borrower the ultimate cost of borrowing including the interest cost, processing fees, other charges etc. so that the borrower understands his or her ultimate cost.
The Company will furnish a copy of the loan agreement preferably in a language as understood by the borrower along with a copy each of all enclosures quoted in the loan agreement to all the borrowers at the time of sanction / disbursement of loans. The exact due dates for repayment of a loan, frequency of repayment, breakup between principal and interest, examples of SMA/NPA classification dates, etc. shall be communicated to the borrower at the time of loan sanction and also at the time of subsequent changes, if any, to the sanction terms/ loan agreement till full repayment of the loan. In cases of loan facilities with moratorium on payment of principal and / or interest, the exact date of commencement of repayment shall also be communicated to the borrower.
The Company will release – within a reasonable time – all securities on repayment of all dues or on realisation of the outstanding amount of loan subject to any legitimate right or lien for any other claim the Company may have against borrower. If such right of set off is to be exercised, the borrower will be given notice about the same with full particulars about the remaining claims and the conditions under which the Company is entitled to retain the securities till the relevant claim is settled/paid.
5. General
- The Company will refrain from interference in the affairs of the borrower except for the purposes provided in the terms and conditions of the loan agreement (unless new information, not earlier disclosed by the borrower has come to the notice of the Company).
- In case of receipt of request from the borrower for transfer of the account, the consent or otherwise i.e., objection of the Company, if any, will be conveyed within 21 days from the date of receipt of request. Such transfer shall be as per transparent contractual terms in consonance with law.
- In the matter of recovery of loans, the Company will not resort to undue harassment viz. persistently bothering the borrowers at odd hours, use of muscle power for recovery of loans, etc. To avoid rude behavior from the staff of the Company, the Company shall ensure that the staff are adequately trained to deal with the customers in an appropriate manner.
- As a measure of customer protection and also in order to bring in uniformity with regard to prepayment of various loans by borrowers of Banks and NBFCs, SFPL will not charge foreclosure charges / pre-payment penalties on all floating rate term loans sanctioned to individual borrowers.
6. Responsibility of Board of Directors
- There will be periodical review of the compliance of the Fair Practices Code and the functioning of the grievance’s redressal mechanism at various levels of management. A consolidated report of such reviews will be submitted to the Board at regular intervals.
- The Board of Directors of the Company has laid down the appropriate grievance redressal mechanism within the organization to resolve complaints and grievances. The mechanism ensures that all disputes arising out of the decisions of lending institution’s functionaries are heard and disposed of appropriately.
7. Grievance Redressal Mechanism
In order to make the redressal mechanism more meaningful and effective, a structured system has been built. This system would ensure that the redressal sought is just and fair and is within the given frame- work of rules and regulation. The following information shall be displayed prominently, for the benefit of the customers, at all branches/ places of the Company, where business is transacted.
7.1 Mechanism to handle customer complaints/ grievances
If a customer believes that we have not lived up to our commitment, we guarantee a prompt and thorough resolution of their complaint to their satisfaction. Customers can register their complaint by following the steps outlined below
Stage 1 – Customer Service Channels to Register Grievances
- Customers can email us at customercare@sahayyafinserve.com between Monday to Friday between 10:00 am to 6:00 pm
- Customers can Visit at our head office or your nearest branch
- Customers can write to us at the following address
Customer Service Department
Sahayya Finserve Private Limited
#78, 2nd floor Sai Sharan Heights,
15th cross Margosa road,
Malleshwaram, Bangalore 560003
We request Existing Customers to please quote your Loan Account Number to our Customer Support Officer when you Email or visit your nearest branch. We assure a reply/acknowledgement to call within 3 working days. We assure a reply/acknowledgement to letters/emails received through this channel within 10 working days.
Stage 2 – Approaching Grievance Redressal Officer
If the customer is not satisfied with the resolution provided by customer service representatives or doesn’t receive any response within 10 working days customer can write, mail or call to the grievance redressal officer of the Company. The name and contact of the Grievance Redressal Officer are as follows:
Ms. Iswariya Rajan
Sahayya Finserve Private Limited
#78, 2nd floor Sai Sharan Heights,
15th cross Margosa road,
Malleshwaram, Bangalore 560003
Email Id: grievance.officer@sahayyafinserve.com
Upon examination of the complaint, the Grievance Redressal Officer assures a reply/acknowledgement to letters/emails received through this channel within 10 working days.
Stage 3 – Approaching Principal Nodal Officer
If the customer is not satisfied with the resolution provided by the Grievance Redressal Officer, or doesn’t receive
any response within 10 working days customer can write, mail to the Principal Nodal Officer of the Company. The
name and contact of the Principal Nodal Officer are as follows:
Mr. Rohith Balakrishnan
Sahayya Finserve Private Limited
#78, 2nd floor Sai Sharan Heights,
15th cross Margosa road,
Malleshwaram, Bangalore 560003
Email Id: sfpl.nodalofficer@sahayyafinserve.com
Stage 4 – Escalation To RBI Ombudsman
If complaint is not redressed within a period of 30 days, customer may approach and lodge a complaint to the
Integrated RBI Ombudsman office.
- Complaint lodging portal of the Ombudsman: https://cms.rbi.org.in
- Complaint letter can be sent to the below mentioned address:
Reserve Bank of India, 4th Floor, Sector 17,
Chandigarh – 160017
7.2 Mandatory- display requirements
The Company is compliant with the following in all our branches:
- Appropriate arrangement for receiving complaints and suggestions.
- Display of the name, address and contact number of the Complaint Redressal Officer
The process of the complaint’s redressal unit will ensure closure of all complaints to the customers’ satisfaction. They will ensure that the complaint is escalated to the appropriate levels in case it is not possible to resolve at his/her level. Whilst the ultimate endeavour is to ensure we reach a situation where our customers don’t have to complain to senior management to get an effective redressal, we have put in a robust mechanism to handle these complaints, review them from a point of view of understanding reasons for the complaint and for the escalation and working on prevention of recurrence thereof.
7.3 Time frame
To register complaints, the customers may use any of the channels mentioned above. If the complaint has been received in writing, the Company will endeavour to send an acknowledgement / response within 7 working days. Once the matter is examined, SFPL endeavours to either send a final response to the customer or an intimation seeking more time within one month upon receipt of complaint. Complaints that are received at our end will be seen in the right perspective and would be analyzed from all possible angles.
Complaints that require some time for examination of issues involved will be acknowledged promptly. The aforesaid policy will be reviewed periodically / revised as and when there are any new changes incorporated by the Company in handling complaints / grievances of the customer which includes introduction of new grievance channels, if any.
8. Language and mode of communicating the Fair Practice Code
Fair Practices Code, preferably in the vernacular language or a language as understood by the borrower should be put up on the web-site of the Company for the information of various stakeholders. Copies will be made available on request.
9. Regulation of Excessive Interest charged
- The Company has laid down appropriate internal principles and procedures in determining interest rates and processing and other charges.
- The Company has adopted an interest rate model taking into account cost of funds, margin and risk premium for determining rate of interest to be charged for loans and advances.
- The rate of interest to be charged depends much upon the gradation of the risk of borrower viz. the financial strength, business, regulatory- environment affecting the business, competition, past history of the borrower etc.
- The applicable interest rate for the exposure shall be disclosed to the borrower or customer in the application form and communicated explicitly in the sanction letter.
- The rate of interest will be annualised so that the borrower is aware of the exact rates that would be charged to the account.
10. Complaints about excessive interest charged
The Company has laid out appropriate internal principles and procedures in determining interest rates and processing and other charges. In this regard the guidelines indicated in the Fair Practices Code about transparency in respect of terms and conditions of the loans will be kept in view.
11. Confidentiality
- Unless authorized by the customer the Company will treat all personal information as private and confidential
- Unless authorized by the customer, the Company will not reveal transaction details to any other entity other than the following exceptional cases:
- To provide the information by statutory or regulatory laws
- If there is a duty to the public to reveal this information
- The Company will not use this as a reason for giving information about customers to anyone else for marketing purposes.
12. Guarantors
The Company shall inform the following information to the person considering to be a guarantor to a loan,
- His/ her liability as guarantor;
- the amount of liability he/ she will be committing him/herself to the company;
- circumstances in which the Company will call on him/her to pay up his/ her liability;
- whether the Company has recourse to his/her other monies in the company if he/ she fail to pay up as a guarantor;
- whether his/her liabilities as a guarantor are limited to a specific quantum or are they unlimited; and
- time and circumstances in which his/ her liabilities as a guarantor will be discharged as also the manner in which the Company will notify him/ her about this.
- In case the guarantor refuses to comply with the demand made by the creditor/ lender, despite having sufficient means to make payment of the dues, such guarantor would also be treated as a willful defaulter.
- The Company shall keep him/her informed of any material adverse change/s in the financial position of the borrower to whom he/ she stands as a guarantor.
13. Miscellaneous
The Company currently does not envisage lending against collateral of gold jewellery or commercial vehicle finance. In the event of addition of these product lines, the FPC policy will be updated suitably, in line with the guidelines laid down by the RBI.
14. Marketing Material
The Company will ensure that all advertising and promotional material is clear, fair reasonable, and not misleading.
The Company will provide the customers with a full range of financial products the customer is eligible for. Some of these products/services will be its own; some others may be the products of companies with which the SFPL will have arrangements with.
15. Review of Fair Practice Code
The Board / the Managing Director / the CEO shall be authorized to review and approve any modifications to the Fair Practice code from time to time.