This Fair Practices Code has been prepared in compliance with the “Guidelines on Fair Practices Code for NBFCs” issued by the Reserve Bank of India and aims to provide its borrowers an effective overview of the practices followed by the Company and to enable borrowers to take informed decisions in respect of the financial facilities and services offered by the Company. The Code covers the general principles on adequate disclosures on the terms and conditions of the loan and the procedures to be followed when dealing with the borrowers. The Code applies to all categories of products and services offered by Cholamandalam Investment and Finance Company Limited (“the Company”).

Objectives of the Code

The following are the primary objectives of this Code:
  • Promote fair and transparent practices by setting minimum standards in dealings with borrowers;
  • Foster fair and cordial relationship between the borrowers and the Company;
  • To ensure compliance with regulatory requirements with regard to customer interface;
  • To strengthen mechanisms for redressal of customer grievances.
Applications for loans and their processing
The Company is in the business of lending and offers various products including vehicle finance, home equity, home loan and corporate finance. Application forms for each of the product offered by the Company would be different depending on the requirement for information for each product.

All communications to the borrower will be in vernacular language or a language as understood by the borrower.

All necessary information that may be required by the borrowers with regard to the financial facility that is being applied for are available in the relevant loan application forms. The information would include matters which may affect the interests of the borrower, so that a meaningful comparison with the terms and conditions offered by other NBFCs can be made and informed decisions can be taken by the borrowers.

Besides, the various documents that need to be submitted with the application form are also provided in the application forms. The Company would give an acknowledgement for receipt of all loan applications. The normal time frame within which loan applications complete in all respects will be disposed of would be indicated in the acknowledgement of loan applications.

The Company would verify the loan applications within a reasonable period of time and if additional details / documents are required, it would intimate the borrowers immediately.
Loan appraisal and terms/conditions

The Company would ensure that there is proper assessment of credit application made by borrowers. The assessment would be in line with the Company's credit policies and procedures.

The Company would convey in writing to the borrower in the vernacular language or a language as understood by the borrower by means of sanction letter or otherwise, the amount of loan sanctioned along with the terms and conditions including annualised rate of interest and method of application thereof and keep the acceptance of these terms and conditions by the borrower on its record. The Company mentions the penal (additional) interest charged for late repayment in bold in the loan agreement. The Company furnishes a copy of the loan agreement in the language as understood by the borrower along with a copy each of all enclosures quoted in the loan agreement at the time of disbursement of the Loan.
Disbursement of loans including changes in terms and conditions
The Company would not cause interference in the affairs of the borrowers except for what is provided in the terms and conditions of the loan agreement (unless new information, not earlier disclosed by the borrower, has come to the notice of the Company).

In case of receipt of request received in writing for transfer of borrowal account, either from the borrower or from a bank/financial institution, which proposes to take over the account, the consent or otherwise i.e., objection of the Company, if any, would be conveyed within 21 days from the date of receipt of request. Such transfer will be as per transparent contractual terms in consonance with law.

The Company would not discriminate on grounds of sex, caste and religion in the matter of lending. However, this does not preclude the Company from participating in credit-linked schemes framed for weaker sections of the society.

In the matter of recovery of loans, the Company would adopt legally valid processes and not resort to undue harassment or use of force viz., persistently bothering the borrowers at odd hours, use of muscle power for recovery of loans, etc., The Company shall adequately train the collection executives and other staff to deal with the borrowers in an appropriate manner.
Grievance Redressal Mechanism
Regulation of excessive interest rate charged
Repossession of vehicles financed by the Company
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