Why the NRIs need NRO accounts?
The account held by the resident Indian will be re-designated as an NRO account, once he/she becomes a Non-Resident Indian (NRI). A new NRO account can be opened in the bank from abroad if they need one. NRO account is maintained in Indian Currency. The NRO account holder can use these funds available in his…
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Why do banks collect credit reports from other 4 CICs besides CIBIL?
In terms of Section 15 of the Credit Information Companies (Regulation) Act, 2005(CICRA), every credit institution shall become a member of at least one Credit Information Company. Normally to adhere to the above regulation most of the Banks and Financial institutions become members of CIBIL to seek CIR of the borrower entity, all the partners,…
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Major centrally sponsored schemes reserved for SC/ST beneficiaries
There are several major centrally sponsored schemes under which credit is provided by banks and subsidy is received through Government Agencies. Credit flow under these schemes is monitored by RBI. Under each of these, there is a significant reservation/relaxation for the members of the SC/ST communities. SCLCSS for under the National SC/ST hub scheme: The…
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Fair Lending Practice – Penal Charges in Loan Accounts: RBI issues draft circular
Reserve Bank of India on Wednesday issued various guidelines to the Regulated Entities (Financial institutions like banks and NBFCs) to ensure reasonableness and transparency in the disclosure of penal interest. Under the extant guidelines, lending institutions have the operational autonomy to formulate Board approved policies for the levy of penal rates of interest. It has…
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Risk to banks and borrowers in innovative upfront disbursal of housing loans
Some banks have introduced innovative Housing Loan Schemes in association with developers/builders. The normal process of these schemes, is upfront disbursal of sanctioned individual housing loans to the builders without linking the disbursals to various stages of construction of the housing project, Interest/EMI on the housing loan availed of by the individual borrower being serviced…
What bank can do if you deposit a fake note in the bank?
Fake Currency Note is a term used to refer to counterfeit currency notes. The fraudster may print imitation (Counterfeit) currency notes and cheat unsuspecting individuals by handing over them as real money. Authority to impound counterfeit notes: The Counterfeit Notes can be impounded by all Banks, Issue Offices of Reserve Bank of India. The notes…
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