Loan Delays and Defaults

Delays

We expect all borrowers to pay their EMIs on time and honour the provisions of the legally enforceable agreement. But there might be instances of delays in payments by borrowers which will result in penalties being imposed. These provisions are all detailed in the agreement along with the amounts applicable. Notwithstanding any information shared here, the provisions of the agreement shall be final in all policies with respect to the late penalties imposed when a payment is delayed.

The late payment penalties are calculated according to the following formulae:

{[Loan Amount x (Rate of Interest/12) x N/30] + (Standard Late Fee)}

where,
Loan Amount = Total Loan Amount availed
Rate of Interest = Interest rate per annum
N = Number of delayed EMIs

Standard Late Fee = Bounce charges calculated at Rs. 200 + applicable taxes for delays upto 5 days, Rs. 300 + applicable taxes for delays from 6-10 days and Rs. 500 + applicable taxes for delays above 10 days.

Defaults

Defaults by borrowers will be dealt with according to the provisions of the agreement and with no prejudice to the lenders absolute right to recover their principal, interest and late payment penalties at any moment during the tenure of the loan.

While the company believes that borrowers need to be given a chance to recover when a loan has been delayed, the chances given to a borrower are limited and only in case an 'intention to pay' is demonstrated. Habitual defaulters will invite measures such as:

• Visits by the repayments team to home, office or any other address shared by the borrower or identified through independent enquiry and/or search by Cashkumar
• Enquiry with references shared by borrower or at the office contact numbers or any other numbers shared by the borrower or identified through independent enquiry and/or search by Cashkumar
• Reporting about the delay/default to all Credit Information Companies as to the length and nature of default
• Deposit of cheque to recover full outstanding loan amount plus interest and applicable penalties
• Filing of a legal case under all sections allowed by the Indian Penal Code
• Reporting legal action taken against the accused borrower to references, employer and all or any contacts shared by the borrower or identified through independent enquiry and/or search by Cashkumar
• Sale of the NPA to other financial institution or recovery company

Not withstanding any information shared here, the provisions of the agreement shall be final in all policies with respect to defaults.