The Fair Practice code of the Company paves the way to good corporate governance and it is the symbol of high level of corporate practices followed by the Company. This has been developed by following the Guidelines on Fair Practice Code issued by Reserve Bank of India.
The Company shall not resort to undue harassment viz; persistently bothering the borrowers at odd hours, use muscle power for recovery of loans etc.
The Company shall train staff especially recovery staffs to avoid rude behaviors and how to approach the borrower in a polite way. The Company shall conduct training for all its staffs in annual basis and an induction programme should be conducted in weekly basis for the new entrants to the Company. Training to field staff shall include programs to inculcate appropriate behavior towards borrowers without adopting any abusive or coercive debt collection / recovery practices.
Recovery should normally be made only at a central designated place. Field staff shall be allowed to make recovery at the place of residence or work of the borrower only if borrower fails to appear at central designated place on two or more successive occasions.
The Company shall ensure that a Board approved policy is in place with regard to Code of Conduct by field staff and systems for their recruitment, training and supervision. The Code should lay down minimum qualifications necessary for the field staff and shall have necessary training tools identified for them to deal with the customers.
Compensation methods for staff should have more emphasis on areas of service and borrower satisfaction than merely the number of loans mobilized and the rate of recovery. -- Penalties may also be imposed in cases of non-compliance by field staff with the Code of conduct. Generally only employees and not out sourced recovery agents be used for recovery in sensitive areas.
The Board shall constitute a grievance redressal committee on Annual basis vide Board Resolution to be passed in the first meeting of the financial year.
The grievance redressal committee shall formulate three layers and should ensure that all disputes arising out of the decisions of lending institutions' functionaries are heard and disposed of at least at the next higher level.
The Board shall conduct periodical review of the compliance of the Fair Practices Code and the functioning of the grievances redressal mechanism at various levels of management on quarterly basis. A consolidated report of such reviews may be submitted to the Board, as may be prescribed by it.
The Company shall display the following information prominently, for the benefit of their customers, at their branches / places where business is transacted:
The Company shall prepare the Fair Practices Code in English language as the same is understood by the borrowers and the same should be put in the website (www.iclcredits.com).
A copy of such terms and conditions must be made available to the borrower in terms of circular wherein it was stated that the Company may invariably furnish a copy of the loan agreement along with a copy each of all enclosures quoted in the loan agreement to all the borrowers at the time of sanction / disbursement of loans, which may form a key component of such contracts/loan agreements.
While lending to individuals against gold jewellery, the Company shall adopt the following in addition to the general guidelines as above.
ID Proof and Address proof of the Borrower.
PAN, if any.
Photo (1 No)
Appraisal procedure for gold
Declaration from the borrower confirming ownership of jewellery.
Proper assaying procedure for the jewellery received
Internal systems to satisfy ownership of the gold jewellery
Adequate systems for storing the jewellery in safe custody, reviewing the systems on an on-going basis, training the concerned staff and periodic inspection by internal auditors to ensure that the procedures are strictly adhered to. Normally, such loans should not be extended by branches that do not have appropriate facility for storage of the jewellery
The jewellery accepted as collateral should be appropriately insured,
Transparent auction procedure in case of non-repayment with adequate prior notice to the borrower. There should be no conflict of interest and the auction process must ensure that there is arm's length relationship in all transactions during the auction including with group companies and related entities
The auction should be announced to the public by issue of advertisements in at least two newspapers, one in vernacular language and another in national daily newspaper. Aution procedure shall be imparted in the loan document.
As a policy, the Company themselves should not participate in the auctions held
Gold pledged will be auctioned only through auctioneers approved by the Board
The policy shall also cover systems and procedures to be put in place for dealing with fraud including separation of duties of mobilization, execution and approval.
The loan agreement shall also disclose details regarding auction procedure.
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