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Dear Customer

Thank You for Banking with us.

The Reserve Bank Of India has vide its circular ‘Fair Lending Practice - Penal Charges in Loan Accounts’ having no. DoR.MCS.REC.28/01.01.001/2023-24 (RBI/2023-24/53) dated August 18, 2023 has issued guidelines for charging penal charges on loans. RBI has issued various guidelines to ensure reasonableness and transparency in disclosure of the charges levied. The circular mandates that penalty if charged for on-compliance of material terms and conditions of loan should be treated as ‘Penal Charges’ and not be levied as ‘Penal Interest’.

Penal charges will not be compounded/ capitalized i.e., Penal charges debited to the loan account and pending servicing/recovery will be excluded from the balance outstanding while computing future interest.

Based on this, we wish to inform you that revised Penal Charges have been made applicable from 01-Apr-2024 for all the new loan facilities which are executed from this date.

Request you to note these charges as mentioned in the Schedule I below:
 

Quantum of Penal Charge Revised Penal Charge for Term Loans Revised Penal Charge for Over Draft / DLOD
Penal charges/penalty for delay in payment of dues including principal, interest, cost, charges, taxes, expenses etc. payable to the Bank 2% + GST on total overdue (P+I) or 100 + GST whichever is higher 24% p.a. + GST on total overdrawn amount X no of days or 100 + GST whichever is higher

For any queries or concerns regarding this change, please contact us at 1860 267 7777 or email us reachus@indusind.com.

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