NEW DELHI, July 1: No bank has the power to employ
bouncers for forceful recovery of loans from customers, Union
Minister of State for Finance Anurag Thakur said in the Lok
Sabha on Monday.
Singh also said there is a clear directive of the Reserve
Bank of India (RBI) to appoint recovery agents only after
proper police verification and fulfilling other relevant
“No one has any power to appoint any musclemen or
bouncers for recovery of loans forcefully,” he said during
the Question Hour.
Thakur said the RBI has issued ‘Guidelines on Fair
Practices Code for Lenders’ which are required to be adopted
by banks, duly approved by their Board.
“The said circular prohibits lenders from resorting to
undue harassment in recovering loans, viz., persistently
bothering borrowers at odd hours, use of muscle power for
recovery of loans etc,” he said.
The minister said with regard to complaints, the RBI has
informed that complaints received by it regarding violation of
the said guidelines and abusive practices followed by banks’
recovery agents are viewed seriously.
“In such cases, the RBI can consider banning the bank
concerned from engaging recovery agents in a particular area
for a specified period.
“In case of persistent breach of above guidelines, the
RBI can also consider extending the period or the area where
the bank concerned is barred from engaging recovery agents,”
he said. (PTI)