Nirmala Sitharaman: PSU banks must provide documents within 15 days of loan closing

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Finance Minister Nirmala Sitharaman in her press conference today announced that Public Sector Banks (PSUs) should guarantee the “compulsory return” of loan documents within 15 days of the closing of loans . This measure is intended to help borrowers who cannot apply for various authorizations or other authorizations although they have repaid their loans because they have not received the loan closing documents.

Bank customers have encountered problems in retrieving loan documents after loan repayments have been completed. Borrowers who have repaid loans often complain that their loan documents or security-related documents have not been returned to them.

“Within 15 days following the closing of the loan, the documents will be returned to the client,” said the Minister of Finance. “It will not be unreasonably detained by the bank,” she added.

This decision is intended to benefit all customers of PSU banks who have repaid all their loans but are having problems recovering their security-related documents.

The finance minister further said that there will be online tracking of loan applications made with the bank or NBFC. This decision will benefit all customers including housing, retail and MSMEs to track their loan applications.

All customers who have applied for loans, including housing, credit enhancement, vehicle, etc. will be able to track their loans. This will increase transparency, reduce harassment and also improve turnaround time for customers, she said.

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