Fair Practice Code

(In terms of the RBI Guideline for Fair Practice Code for NBFCs vide Letter their No DNBS.CC.PD.No.266 /03.10.01/2011-12 Dt March 26, 2012) .The VSC Finance Private Limited here-in-after referred as ‘Company' (for the sake of brevity) has agreed to follow under mentioned business practices:

(a) All communications to the borrower shall be in the Hindi/English language or a language as understood by the borrower.
(b) Loan application forms would include necessary information which affects the interest of the borrower, so that a meaningful comparison with the terms and conditions offered by other Company can be made and informed decision can be taken by the borrower. The loan application form indicates the documents required to be submitted with the application form.
(c) The Company has a system of giving acknowledgement for receipt of all loan applications. Preferably, the time frame within which loan applications will be disposed of would also be indicated in the acknowledgement.

Loan appraisal and terms/conditions

The Company would convey in writing to the borrower in the vernacular 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.
Company shall furnish a copy of the loan agreement preferably in the vernacular language as understood by the borrower along with a copy each of all enclosures quoted in the loan agreement to all the borrowers at the time of sanction / disbursement of loans.

Disbursement of loans including changes in terms and conditions

(a) The Company would give notice to the borrower in the vernacular language as understood by the borrower of any change in the terms and conditions including disbursement schedule, interest rates, service charges, prepayment charges etc. Company would also ensure that changes in interest rates and charges are effected only prospectively. A suitable condition in this regard would be incorporated in the loan agreement.
(b) Decision to recall / accelerate payment or performance under the agreement would be in consonance with the loan agreement.
(c) Company would release all securities on repayment of all dues or on realisation of the outstanding amount of loan subject to any legitimate right or lien for any other claim Company may have against borrower. If such right of set off is to be exercised, the borrower shall be given notice about the same with full particulars about the remaining claims and the conditions under which Company are entitled to retain the securities till the relevant claim is settled/paid.


General

(a) Company would refrain from interference in the affairs of the borrower except for the purposes 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 lender).
(b) In case of receipt of request from the borrower for transfer of borrowal account, the consent or otherwise i.e. objection of the Compsny, if any, would be conveyed within 21 days from the date of receipt of request. Such transfer shall be as per transparent contractual terms in consonance with law.
(c) In the matter of recovery of loans, the Company would not resort to undue harassment viz. persistently bothering the borrowers at odd hours, use of muscle power for recovery of loans etc.

The Company has laid down the appropriate grievance redressal mechanism within the organization to resolve disputes arising in this regard.

The Company has laid out appropriate internal principles and procedures in determining interest rates and processing and other charges.

Regulation of excessive interest charged by Company

(a) The Company has adopted an interest rate model taking into account relevant factors such as, cost of funds, margin and risk premium, etc and determine the rate of interest to be charged for loans and advances. The rate of interest and the approach for gradations of risk and rationale for charging different rate of interest to different categories of borrowers shall be disclosed to the borrower or customer in the application form and communicated explicitly in the sanction letter.
(b) The annualized rates of interest and the approach for gradation of risks has also made available on the web-site of the companies.

The company do not finance vehicles
Applications for loans and their processing

The Company offers various products but mainly personal/business loans,. Application forms for each of the product offered by the Company would be different depending on the requirement for information for each product. All necessary information required for the borrowers are available in the relevant application forms. Besides the various documents that need to be submitted with the application form are also provided in the application forms. The information would include information about the fees/charges, if any, payable for processing, the amount of such fees that might be refundable in the case of non acceptance of application, pre-payment options and any other matter which affects the interest of the borrower, so that a meaningful comparison with that of other competitors can be made and informed decision can be taken by the borrowers. 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 such applications. The company would verify the loan applications within a reasonable period of time. If additional details / documents are required, it would intimate the customers 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' credit policies and procedures. The Company would convey in writing to the borrower 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. A copy of the loan agreement along with a copy each of all enclosures quoted in the loan agreement may be furnished to the borrower, if asked for.

Disbursement of loans including changes in terms and conditions

The Company would ensure timely disbursement of loans sanctioned in conformity with the terms and conditions governing such sanction. It would give notice of any change in the terms and conditions including disbursement schedule, interest rates, service charges, prepayment charges etc. It would also ensure that changes in interest rates and charges are effected only prospectively.

Post disbursement supervision

The Company would carry out post-disbursement supervision in accordance with normal business practice, the terms of sanction, and the guidelines issued by the Reserve Bank of India from time to time. The Company would carry out any decision to recall / accelerate payment or performance under the agreement only in consonance with the loan agreement. The Company would release all securities on repayment of all dues or on realisation of the outstanding amount of loan subject to any legitimate right or lien for any other claim the Company may have against borrower with prior notice to the customers. The notice will provide full particulars about the remaining claims and the provisions under which the Company is entitled to retain the securities till the relevant claim is settled/paid.

General

The Company would not cause interference in the day-to-day affairs of the borrowers except for what is provided in the terms and conditions of the loan sanction documents (unless new information, not earlier disclosed by the borrower, has come to the notice of the Company). 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.. In case of receipt of request 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.

Grievance Redressal Mechanism

Disputes arising out of decisions of the Company's functionaries would be disposed of at the next higher level within the Department concerned. A review of compliance of the Fair Practices Code and the functioning of the grievance redressal mechanism would be done by the Board of directors once in 6 months.