The Reserve Bank of India (RBI) has laid out specific guidelines for recovery agents to ensure fair practices during the recovery of housing loans. These guidelines are intended to safeguard borrowers from harassment and maintain ethical standards in debt recovery practices. Here are the key RBI guidelines for recovery agents:

1. Appointment of Recovery Agents
– Banks must ensure that recovery agents are properly trained and authorized to handle loan recovery cases.
– Recovery agents must adhere to a formal code of conduct, which outlines their expected behavior and procedures during recovery.
– Banks should ensure that the recovery agents act in a responsible and respectful manner.

2. Appropriate Timing of Calls and Visits
– Recovery agents can only contact borrowers between 8 a.m. and 7 p.m. unless the borrower consents to a different time.
– Unnecessary harassment or excessive phone calls to the borrower or their family members should be avoided.

3. Identification of Recovery Agents
– Recovery agents must carry a valid identification card issued by the bank, and they must show this ID when they visit borrowers.
– They must also carry a written authorization letter from the bank mentioning the loan details and the purpose of the visit.

4. Fair Practices
– Banks and recovery agents must follow fair practices when engaging with borrowers. They should not resort to aggressive or coercive methods to recover dues.
– Any recovery-related communication should be transparent, clear, and professional.
– Misleading borrowers about the consequences of non-payment is strictly prohibited.

5. Grievance Redressal
– Banks should establish an effective grievance redressal mechanism for borrowers to raise complaints regarding harassment by recovery agents.
– Borrowers should be informed about this mechanism, and complaints must be resolved in a timely manner.

6. Adherence to the Legal Framework
– Recovery agents should adhere to legal procedures, including any court orders, when seizing property or taking legal action against defaulters.
– Banks must ensure that all recovery actions are compliant with applicable laws, including the SARFAESI Act (Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act) and other legal provisions.

7. Communication Protocol
– Recovery agents should maintain confidentiality and should not disclose loan information to unauthorized persons.
– The borrower must be given sufficient time and notice regarding repayment before any recovery action is taken.

These guidelines aim to protect borrowers from harassment and ensure that recovery actions are conducted fairly and ethically by banks and their agents.

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