RBI has given orders to all the banks on your loan, hide and seek will not work in the loan! First of all, let us tell you that the RBI order will be applicable to all retail loans and MSME loans. Reserve Bank of India (RBI) has given orders to all banks and NBFCs. These orders are regarding loan related charges or fees. These new rules of RBI will come into effect from October 1 this year.
Banks will have to give Key Fact Statement (KFS). If understood in simple language, the main facts of the KFS loan agreement are detailed. This is given to the loan takers. Now you do not need to be afraid of hidden charges while taking loan from banks. The Reserve Bank has issued a special order for all banks, which will have to be implemented from October 1. Know what has been said in the order of the Reserve Bank and how the consumer will benefit from it.
RBI has said that there should be complete information about all the fees related to the loan. Banks will also have to disclose the Annual Percentage Rate (APR) of the loan. APR indicates the annual cost of the loan. Banks will have to disclose the cost of credit every year. Along with this, banks will also have to give details of interest rate, insurance charge and legal charges to their customers. Details of the bank’s policy will have to be given to the recovery agent.