Reserve Bank of India (RBI), in March, had announced a moratorium
on repayment of term loans in order to provide relief to borrowers impacted by
the Covid-19 related disruptions.
Microfinance
Institutions Network (MFIN), an industry association for the microfinance
industry, on Tuesday said it has issued an advisory to its members on engaging
with borrowers after the RBI moratorium ended on August 31, 2020.
Reserve
Bank of India (RBI), in March, had announced a moratorium on repayment of
term loans in order to provide relief to borrowers impacted by the Covid-19
related disruptions. Initially, the moratorium was allowed till May 31 but was
later extended till August 31.
MFIN said the
detailed advisory is a reiteration of points covered in Industry Code of
Conduct and Code of Responsible Lending such as fair interactions with
borrowers, ensuring transparency, training for employees engaging with
borrowers, among several others and also covers safeguards for Covid-19.
"There could
be borrowers who might be facing stress. All providers (of microcredit) agree
that we must continue to show empathy with these borrowers and allow them time
to get on their feet, even though credit discipline is important," MFIN's
CEO and Director Alok Misra said in a release.
There is a need to
handhold those who availed the moratorium and are willing to repay with
relevant documents; revised loan card, accrued interest amount, changes in
repayment amounts and schedule, tenure, among others, he added.
MFIN, a
RBI-recognised self-regulatory organisation, has a Customer Grievance Redressal
Mechanism (CGRM) in place wherein any customer can complain on its toll-free
number 1800 102 1080, the release said.
MFIN members
include 56 NBFC-MFIs (Non-Banking Financial Company- Microfinance Institutions)
and 40 associates, including banks, small finance banks and NBFCs.
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