Now Reading: RBI issues new loan recovery rules, effective 1 Jan 2027
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RBI issues new loan recovery rules, effective 1 Jan 2027
The Reserve Bank of India (RBI) has issued a new framework for loan recovery, effective 1 January 2027. Recovery agents cannot threaten, abuse, or harass borrowers. Calls and visits are allowed only…
The Story in Brief
The Reserve Bank of India (RBI) has issued a new framework for loan recovery, effective 1 January 2027. Recovery agents cannot threaten, abuse, or harass borrowers. Calls and visits are allowed only between 8 am and 7 pm unless the borrower agrees otherwise. Agents must carry an identity card and authorisation letter from the bank. Banks remain responsible even if they outsource recovery. If violations cause loss, the bank must compensate the borrower. The rules also ban recovery calls during family emergencies and require every bank to have a dedicated complaint officer, Business Today reports.
The Indian Opinion
Borrowers will cheer the new RBI rules, but some bankers may grumble about extra compliance. The real test is whether banks set up genuine compensation mechanisms and end the culture of third-party harassment. Watch for the number of complaints filed after 2027, that will tell if the regulator’s framework is a paper tiger or a real shield.
Source: bazaar.businesstoday.in
This story was synthesised by AI from the source linked above.
