FAIR PRACTICE CODE
FAIR PRACTICE CODE
1. General Information
1.1 Preliminary Remarks:
According to Daimler Financial Services India Private Limited (DFSI)’s Code of Ethics & Fair Practice, DFSI promotes Compliance with applicable laws, rules and regulations. Due to the importance of lending business by NBFC’s in India, Reserve Bank of India, has sets minimum standards for NBFC’s for doing business based on Fair Practices Code. Adherence to the DFSI Fair Practices Code is the responsibility of all employees of DFSI.
The policy is formulated and directed by DFSI Leadership team. The policy includes employee & client screening and monitoring requirements, fair practices to be adopted while doing lending business & recovery of dues, record keeping requirements in accordance with relevant laws of land, and training.
1.2 Legal Basis
The standards set out in this Policy are minimum requirements based on applicable legal and regulatory requirements as issued by Reserve Bank of India
1.2.2 Local Laws & its Applicability
The Reserve Bank of India, by its notification no DNBR (PD) CC.No.054/03.10.119/2015-16 dated July 1, 2015 has prescribed the guidelines on fair practices that are to be framed and approved by the Director of all Non- Banking Financial Companies (NBFCs). The fair practices code so framed and approved by the Director should be published and disseminated on the web-site of the company, if any, for the information of the public.
The code has been developed with an object to:
• Promote fair practices by setting minimum standards in dealing with customer.
• Increase transparency so that customer can have a better understanding of what type of service level can be expected from the company.
• Foster customer confidence in the company.
The code applies to all employees & products as may be offered by the company.
The Board of Directors & the Leadership Team of DFSI are responsible for Fair Practices Code implementation & monitoring.
3. Key Commitments
3.1 To help borrower / customer understand Company’s financial products and services by:
3.1.1 Ensuring that the customer is given clear information about Company’s product and services, the terms and conditions and interest rates/service charges, which apply to them in the loan application form
3.1.2 Keeping customer informed about changes in the interest rates, charges, terms and conditions
3.2 To act fairly and reasonably in all dealings with the customer by:
3.2.1 Meeting the commitments and standards in this code for products and services offered by the Company
3.2.2 Making sure that products and services meet relevant principles of integrity and transparency
3.2.3 Informing customer about the time limit by which loan application will be processed and informing them of the status at regular intervals
3.2.4 Handling customer complaints promptly
3.2.5 Informing customers about the process to take their complaints forward to the higher authorities
3.3 To treat personal information of customers as private and confidential
4.1 All communications to the shall be in the vernacular language or a language as understood by the borrower
4.2 The customer shall be given information regarding interest rates, terms and conditions for loan and other charges in a clear and precise manner. The Loan Application Form may indicate the documents required to be submitted with the application form and also the rate of interest which is applicable to the customer
4.3 Acknowledgement shall be given on receipt of loan application documents. Normal time frame for processing of the Loan Application would also be informed to the customers.
4.4 After the loan is sanctioned, customer shall be informed about the annualized rate of interest at which loan is sanctioned, and the method of application thereof, mode & time at which the interest will be debited and other terms and conditions applicable to loan. The Company shall keep the record of acceptance of these terms and conditions by the Borrower.
4.5 The company has to furnish a copy of the loan agreement 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 Company shall mention the penal interest charged for late repayment in bold in the loan agreement.
4.5 The Company shall inform customer about any changes made in the terms and conditions like disbursement schedule, interest rates, service charges, prepayment charges etc applicable to the loan. Such changes shall be effected prospectively. A suitable condition in this regard would be incorporated accordingly in the Loan Agreement.
5. Post Disbursement Supervision:
5.1 Post disbursement supervision would be constructive.
5.2 Decision to recall / accelerate payment or performance under the agreement will be in consonance with the loan agreement. For example, in case there is a shortfall in margin/security given due to market fluctuation requiring borrower to give additional margin/security or due to some other reason loan needs to be recalled or payment needs to be accelerated earlier than schedule, same shall be communicated to customer and sufficient notice, as specified in the agreement, will be given to him.
5.3 The Company shall release securities on repayment of all dues or on realization of outstanding amount of loan subject to any pending unsettled claims of the Company. The securities would be withheld after informing client full particulars about the pending claims and the conditions under which the Company is entitled to retain the securities till the relevant claim is settled.
5.4 The Company may follow its procedure for recovery as laid down in compliance with the law of land in case the customer defaults even after giving reasonable chances to cure.
6. Non-Interference in the Affairs of the borrower:
6.1 The Company shall not interfere in the affairs of the borrower except for the purposes provided for in the terms and conditions of sanction of the loan.
7.1 The Company shall treat customer information as private and confidential and shall be guided by principles of confidentiality. The information shall be parted by the Company only in the following circumstances:
7.1.1 Information required to be given under law or as demanded or required by statutory authorities;
7.1.2 Information is given with customer’s specific written permission.
7.2 In case of receipt of request for transfer of borrower account, either from the borrower or from a lender which proposes to take over the account, the consent or otherwise would be conveyed within 21 days from the date of receipt of request. Such transfer would be as per transparent contractual terms in consonance with law.
8. Collection of Dues
8.1 Company’s collection policy shall be built on courtesy, fair treatment and persuasion. Efforts will be made in building customer confidence and long term relationship;
8.2 The staff deputed to make recovery calls shall identify themselves and shall provide details with regard to outstanding claims to the customer;
8.3 Under no circumstances, Company shall resort to harassment of the customer for recovery of the dues.
8.4 The company should have the repossession clause in the loan agreement which should be legally enforceable and contains all the necessary details of the process of repossession
9. Complaints, Grievances & Feedback
9.1 If complaint is received in writing or over phone, complaint number would be given which would be referred to in future. Complaint register would be maintained. A person will be designated to receive complaints from customers;
9.2 Company will endeavor to sort out the matter within 30 working days of receipt of a complaint. In case of any delay in resolving the complaint the customer is kept informed about the resolution status.
9.3 The company shall display, for the benefit of their customers, at their branches / places where business is transacted: the name and contact details (Telephone / Mobile nos. as also email address) of the Grievance Redressal Officer who can be approached by the public for resolution of complaints against the Company
9.4 Mr. V Prasad, Head – Customer Services, Unit 202, 2nd Floor, Campus 3B, RMZ Millennia Business Park, No.143, Dr. MGR Road, Perungudi, Chennai -600096, Tel: (+91) 44 7111 8178, Email: firstname.lastname@example.org is the Grievance Redressal Officer under the Fair Practices Code who can be approached by MBF Customers for resolution of complaints against the Company specifically related to Financial Services. If the complaint / dispute related to Financial Services is not redressed within a period of one month or jointly agreed with the customer, the customer may appeal to the Officer-in-Charge of the Regional Office of Department of Non-Banking Supervision (DNBS), Reserve Bank of India, Fort Glacis, Rajaji Salai, Chennai 600 001, Tamil Nadu, Tel: 044-2536 1490/ 044-2539 9222, Fax No: 044-25393797, Email: email@example.com under whose jurisdiction the registered office of the Company falls.
The Board of Directors will periodically review the compliance of Fair Practices Code and the functioning of the grievances redressal mechanism at various levels of management.
11. Employee Training
The Company shall organize training for all employees of the Company responsible for interaction with customers at intervals as deemed fit and fair to the board.