Now Reading: RBI bans loan recovery harassment from January 2027
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RBI bans loan recovery harassment from January 2027
The Reserve Bank of India has issued stricter guidelines to curb harassment by loan recovery agents, effective from January 1, 2027. Banks must now inform borrowers in advance of the agent’s name…
The Story in Brief
The Reserve Bank of India has issued stricter guidelines to curb harassment by loan recovery agents, effective from January 1, 2027. Banks must now inform borrowers in advance of the agent’s name and contact details. Recovery agents are banned from using abusive language, anonymous calls, late-night visits, or threats. Banks must maintain recordings of all interactions. If a borrower’s device is locked as collateral, it must be unlocked within one hour of repayment, or the bank must compensate the customer. The new rules apply to all banks and non-banking finance companies.
The Indian Opinion
The RBI’s new rules are welcome, but one-sided narratives are already forming. Some will claim these measures burden banks with excessive compliance, ignoring that banks themselves failed to police their recovery agencies. Others will argue the 2027 deadline is too generous, forgetting that systems need retooling. The real test is whether the compensation mechanism actually works. Watch the number of complaints filed with the mandated grievance cells in the first six months of 2027.
Sources (2): indiatvnews.com, odishatv.in
This story was synthesised by AI from the 2 sources linked above.
