RBI to Curb Coercion in Loan Recovery, Issue New Guidelines Soon

• RBI to issue draft guidelines for consumer protection to stop arbitrary practices by banks and NBFCs in loan recovery.
• The central bank will specify methods banks and NBFCs can use for loan recovery and review the use of recovery agents.
• Compliance guidelines will increase responsibilities for lending banks and NBFCs, reducing recovery-related disputes.
• RBI will formulate strict rules to prevent mis-selling of financial products and services, ensuring alignment with customer needs and risk ability.
• Comprehensive instructions will be issued to regulated entities regarding advertising, marketing, and sales of financial products and services.