COMPENSATION POLICY FOR PAYMENT OF COMPENSATION

FOR DELAY BEYOND 15 DAYS IN RETURN OF SECURITIES/DOCUMENTS TO THE BORROWERS

Attention of Branches/Regional Offices is drawn to the captioned subject and guidelines issued on BCSBI.

Branches are aware that our Bank has become a member of Banking Codes and Standards Board of India (BCSBI).  As per the guidelines of BCSBI, the Bank adopted the policy of Cheque Collection, Compensation, Grievance redressal, commitment to customers, Micro and Small Enterprises (MSEs).

BCSBI had suggested the Bank to adopt the compensation policy for payment of compensation for delay beyond 15 days in return of securities/documents as per the revised policy of IBA and place the same in the Bank's website for the information of customers.

Accordingly, the matter has been placed before Board, and in the Board meeting held on 12.03.2012, the Board of Directors have approved and advised the Bank to initiate steps to prepare and adopt policies necessary for complying with the guidelines of BCSBI.

Accordingly, the policy of Bank's commitment of payment of Compensation to the borrowers for delay beyond 15 days in return of securities/documents, as per the revised compensation policy of IBA is worked out and furnished here under.          
POLICY:

1. The Bank would return to the borrowers all the securities/documents/title deeds to mortgaged property within 15 days of repayment of all dues with interest agreed to or contracted.
2. If any right to set off or General Lien is to be exercised for any other claim, the Bank will give due notice with full particulars about other claims and retain the securities/documents/title deeds to the mortgaged property till the relevant claim is settled or paid.
3. In case of delay in returning the securities/documents/title deeds to mortgaged property beyond 15 days of repayment of all dues with interest agreed to or contracted, the Bank will pay compensation at the rate of Rs 100/- per day beyond 15 days.
4. In the event of loss of title deeds to mortgage property at the hands of the Bank, the compensation will cover out of pocket expenses for obtaining duplicate or certified copy of the documents besides normal compensation as stated above.

In view of the above, branches are advised as under.

1. To return to the borrowers, the securities/documents/title deeds to mortgaged property within 15 days of repayment of all dues with interest and other charges.
2. To issue notice immediately with full particulars about other claims/liabilities if any, and retain the securities/documents/title deeds to the property and exercise right to set off/general lien for such claims till the same are settled or paid.
3. To recover the compensation paid on the above lines if any, for delay in returning the securities/documents/title deeds to the mortgaged property beyond 15 days of repayment of all dues with interest and other charges agreed or contracted, from the Branch Head/s Officer-in charge responsible during the said period of 15 days.
4. To recover the compensation paid on the above lines if any, in the event of loss of title deeds to mortgaged property at the hands of the Bank, from the Branch head/s/ officer in charge, responsible for the loss.

All the branches/Regional Offices are advised to note and be guided as above.
Clarifications required, if any, on this circular may be sought from Credit Department, Head Office, Kadapa.

GENERAL MANAGER