The Reserve Bank of India on Friday barred banks from resorting to any verbal or physical harassment of customers through agents in case of loan defaults and warned that the Central banking authority may consider ban on banks in case of any violation of the rules.

Issuing a set of draft guidelines for banks on the use of recovery agents, the RBI said banks will have to inform borrowers the details of agents being used to pursue any default cases.

The Central bank also said that recovery agents will have to call borrowers from telephone numbers notified to them and such agents need to undergo a minimum of 100 hours of training before joining such a job.

The RBI requested bankers' bodies like the Indian Banks Association or IBA and IIBF to start a certificate course for recovery agents in order to train them properly before using them against loan defaulters.

The banks have also been told to clearly incorporate repossession clauses in loan contracts and while exercising such rights, the banks will have to give a notice period to the customer before going in for repossession of an asset.

The banks have also been told to notify its customers about the procedures to be followed for the sale or auction of any repossessed property. The Central bank advised banking institutions to use lok adalats for cases relating to recovery of consumer loans bellow Rs 10 lakhs in order to ensure speedy disposal of such matters.

Your Mobile Number Will be Portable!!

We have all gone through the endless frustration of changing mobile numbers and sending out countless messages alerting the change in number. And we needn’t go into the number of times we’ve had to change or edit contact numbers of friends and acquaintances because they have changed moved elsewhere or simply changed mobile carriers. But all that will soon change.

The Indian Government has, on the Telecom Regulatory Authority of India’s (TRAI) recommendation, decided to implement mobile number portability (MNP) in India. MNP will allow you to switch mobile carriers without changing your number, a very welcome news no doubt for all mobile users.

A Raja, Communications minister yesterday approved the MNP support in four metros i.e. Mumbai, Kolkata, Chennai and Delhi. This should soon be expanded to other parts of the country as well. As of now the MNP introduced does not include switching service type – mobile to fixed line or locations – from Mumbai to Delhi and vice versa; i.e. you can only switch mobile carriers within the same city.

So, no longer sticking it out with a service provider simply because you don’t want to change your number. This is exactly the freedom mobile users were looking for. MNP will make lives simpler for us and make the going somewhat tough for mobile operators, who will have to be on top of their service at all times, else they’ll lose customers.

MNP is expected to come into action only by March 2008, so it gives mobile operators plenty of time to woo customers and gather a loyal bunch. So, don’t be surprised if you are suddenly flooded with offers and schemes that are an absolute peach. Mobile users, make the most of it. Happy times await!

Some Good News!!

Days after the Reserve Bank of India sent out a strict warning to banks to stop using recovery agents with strong arm tactics to recover loans, the State Consumer Disputes Redressal Commission of Delhi has fined the ICICI Bank a whopping Rs 55 lakh for employing 'goons' to recover loan from a customer.

Deploring the practice of the banks intimidating consumers to pay the installments, the consumer court held ICICI Bank guilty of using goons to harass a consumer, Tapan Bose, and his friend's son Vinod Chowdhary.

Vinod had to be admitted to hospital after the recovery agents mercilessly beat him up while they snatched a loaned car from him in January this year. The incident occurred when Vinod was driving Bose's car, which was bought on a car loan from the ICICI Bank.

While passing the order, the court warned all banks against using musclemen for loan recovery and asked the Delhi police commissioner to instruct all SHOs to register FIRs against such complaints.

The commission deprecated the 'audacity and impunity' with which the banks have been effecting forcible possession of vehicles. "No civilised society governed by rule of law can brook such kind of conduct," the Commission's President Justice JD Kapoor said.

He also described the violent methods adopted by the recovery agents as a serious violation of 'human rights'. Holding the ICICI Bank guilty of 'unfair trade practice', the commission termed such miscreants as 'yahoos' and said they are boorish and a brutal lout, who care a fig for legal and judicial authorities, including the Supreme Court.

While taking to task the leading bank, it vented its anger on the ICICI for flouting the apex court's direction that restrained all the financial institutions from employing musclemen to recover a loan amount or possession of a vehicle.