The interest rate on advance levied by banks comprises ‘Base Rate’ of the respective bank and ‘Spread’ over the base rate decided by the banks Board. Though ‘Base Rate’ is constant for computation of interest on all advances, the ‘Spread’ over base rate varies on each category of advances depending upon tenure of loan, risk…
DRI loans scheme (also known as DIR loan scheme) was introduced in the year 1972 to financially assist chosen low income groups. The loan scheme envisages lending by banks to weaker section of the society at a uniform concessional rate of interest of 4% per annum. The borrowers under this category of loan are rural…
The definition of Non-Cooperative Borrowers is originally defined in RBI circular dated 26.02.2014 on ‘Frame work for Revitalizing Distressed Assets in the Economy-Guidelines on Joint Lenders’ Forum (JLF) and Corrective Action Plan (CAP). The definition of a Non-Cooperative Borrower as contained therein is now modified by RBI which reads as under: “A non-cooperative borrower is…
Inspection of factory unit or godown of the borrower at regular interval is an important and desired activity of banker to monitor the borrowal account. Bankers have to have learned how to inspect a factory unit or godown. Out of many years of experience, bankers have developed expertise in the method of assessing the value of…
Recovery through award of Lok Adalat is the easiest and fastest mode of recovery. The literal meaning of Lok Adalat is people’s Court. The concept comes under the ‘Alternative Disputes Redressal Mechanism’ like arbitration, conciliation etc. The pre-litigation up to Rs.20 lacs and suit filed accounts where plaint amount does not exceed Rs.20 lacs can be…
Latest amendment: The notification of finance ministry, Government of India on September 6, 2018 increased the monetary limit up to Rs.20 lakh from earlier limit of Rs.10 lakh for filing loan recovery application in the Debt Recovery Tribunals (DRT) by banks and financial institutions. As per the plan, a common e-auction platform will be set…
(This article envisions what are the title deeds of a property,how to examine them and how to find out the construction is legal and authorized etc.) Identifying a property for purchase is not just about the price of the property, locality or amenities like gym, club swimming pool etc. Along with identifying a property which…
(This article clarifies on who is eligible ( the age, limit, qualification) including quantum of subsidy, bank loan and money to be bought up by the entrepreneur to start up a business for bank finance under PMEGP scheme.) Online submission of applications for loans under PMEGP is mandatory and no manual applications are allowed w.e.f. 01.05.2016.The…
(This article envisages what are the expenses considered for the loan, what will be the quantum of loan and margin, what will be the repayment/holiday, moratorium period, what type of security to be offered, what is a capability certificate, significant tax benefits etc. ) IBA has revised the guidlines on education loan.Click here to know…
(The following article examines the documents required to the bank in respect of borrower’s profile and property to be purchased. It also provides the requirement of the bank with the list of Property related documents for building /Construction of the individual house on an open plot or purchase of flat/constructed property and common requirement for sanction…