Need counseling for your loan?

By Pradeep Yuvaraj | April 7, 2014

Are you tired of paying your loan EMIs and is it taking a toll on your health? Are you a genuine customer who is currently in a financial position which does not let you repay your loans on time? Would you like to share your worries with a well wisher who can, not only lend you an ear, but, maybe also do something to alleviate your problems? Help is at hand. That too free of cost! The BSCBI’s Credit Counseling Service.

The Banking Codes and Services Board of India offers a free of cost Credit Counseling service to Individuals who have taken Home Loans, Personal Loans, Vehicle Loan or incurred Credit card debt upto a maximum limit of Rs 50 Lakhs. The service is available only if you have taken a loan from member banks of BCSBI. The list of members currently has 80 banks which include all State Banks and mostly all Private Banks and many co-operative and rural banks. This service is also available to Micro and Small Enterprises.

How it takes place

  1. Borrower directly contacts BCSBI
  2. Lender refers distressed defaulters to BCSBI

The customer has to apply to BCSBI using an application form which is available online. The customer is then asked to meet a credit counselor of BCSBI who takes into consideration all details and creates a debt restructuring plan if needed. This plan is done in consultation with the bank which has lent to the said customer. It must be said that, there is no compulsion that the bank has to accept the plan. It is free to reject it or accept it partially or completely depending upon its own views. The BCSBI Counselor only acts as mediator.

Confidentiality

All the details shared by customer and bank with the credit counselor are kept highly confidential and customers can confidently share all details with counselor to get the best relief possible.

The BSCBI has also encouraged banks to appoint a nodal officer, preferably from the credit department, to ensure that there is high efficiency and commitment in the entire process. This also ensures that the banks views are communicated faster.

Where and When

The only limitation of this process is that the counseling currently happens only in Mumbai on all working days from 10AM to 2:00 PM. But customers can apply online to get a prior appointment.

The borrower has to give a self attestation that the issue is not under arbitration in any other forum or court or arbitrator while filling the form. If such a case exists the counselor will not entertain the request for counseling.

Customer’ duty

The customer is expected to transparently give all the details regarding his current financial status including asset details, income details, and monthly expenses apart from the complete details of the loan under consideration. The counselor will also expect to get a clear commitment of the customer’s ability to pay at present to decide on the restructuring.

Conclusion

The service is to help in debt restructuring and is NOT to help a customer get a waiver on repayment. Also, there is no compulsion on either parties (customer or bank) to accept the recommendations of the counselor.

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Category: Juggling debts Loans Money Management Yahoo

About Pradeep Yuvaraj

Pradeep Yuvaraj is a Co-Founder and Director at Finerva Financial Solutions Private Limited, a financial education company focused on personal finance education. He has penned over 250 articles relating to Personal Finance and clocked over 500 hours of educating individuals on managing personal finance. He is a serial entrepreneur and has been associated with 7 Start-ups. His entrepreneurial experience spans industries as varied as Education, Gas Engineering, Automobile Design, Software development and more recently a Pure play presentation design company. Prior to turning entrepreneur in 2005, he has worked for 3 of the top ten companies of the world - Shell, ExxonMobil and Total SA. This experience included handling Branch Operations, Channel Sales and Business Development across 5 states over a period of 8 years. He holds an MBA from Symbiosis and an Electronics Engineering Degree from the University of Pune.

3 thoughts on “Need counseling for your loan?

  1. SANKAR N K

    Customer counselling is a must to build up a healthy economy. Many people can avoid borrowing, if they streamline their income flow. On an average, as much 30% of the amount borrowed is wrongly utilised. Further, all banks must have Credit Officers who have thorough knowledge of financial market. They can ensure qualitative and quantitative loans. As of now, the real NPA level in Indian banking system is about 10 times of what are being published. If a borrower get trapped in financial problems, they tend to borrow more – either from public financial institutions or from private money lenders, and get into bigger problems. A good counselling can make such people where they went wrong, and streamline their financial activities and come out of their problems. Being a manager in a nationalised bank, I stress for financial discipline along with cash flow and capital appreciation.

    Reply
  2. Sagarkumar

    I am trying to apply personal loan.. first of all my self sagar , a salaried employ in italy….. is possible to get a loan..

    Reply
    1. Team BankBazaar

      Hi Sagarkumar, Thanks for writing to us. To know more about your Personal Loan eligibility, please click here. Cheers,
      Team BankBazaar

      Reply

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