Kalpathi Investments Home | About us | Fair Practice Code| Know Your Customer| View Public Documents| Careers | Contact us




FAIR PRACTICES CODE OF THE COMPANY


1. Introduction

Reserve Bank of India (RBI) has prescribed guidelines on Fair Practices for all Non Banking Financial Companies (NBFC) on the basis of which Fair Practices Code ("FPC") shall be put in place by NBFC's. RBI has prescribed broad guidelines on fair practices which, inter alia, include processing of application for loans, appraisal of loan, loan disbursement including changes in terms and conditions and certain other conditions/aspects which NBFC's need to follow.

The Fair Practice Code ("FPC") of the Company has been prepared in accordance with the RBI master circular / notifications to the extent applicable and aims to ensure fair, transparent and ethical lending practices across all dealings with prospective customers.

2. Background

Kalpathi investments Private Limited, (KIPL / Company) is a Non-Banking Financial (Non-Deposit Accepting or Holding) Investment and Credit Company, which is closely held and funded exclusively by the Promoters without any external Borrowings/ Deposits for investments in the startup ecosystem based on referrals and our own internal validations of the promoters and their ventures. Now the Company is intending to focus on the lending activities.

3. Fair Practices Code

In accordance with the RBI Regulations the Company has put in place the Fair Practice Code (FPC) with the approval of its board. The FPC is displayed by the Company on its website. The FPC is issued in a language understood by the borrower.

4. Applications for Loans and their Processing:

(a) All communications to the customer by KIPL shall be in English as it is commonly understood by all the customers of KIPL. If a customer explicitly requests communication in another language, KIPL will acknowledge this preference, and all subsequent communications with that client will be in the requested language.

(b) The Company conducts basic due diligence and "Know Your Customer" checks before dealing.

(c) As part of the process and to ensure transparency, KIPL, at the application stage, shall provide all necessary information including but not restricted to processing fees/charges, if any, non-refundable fees in case of rejection of loan proposal, pre-payment options etc., which effects the interest of the customer so that a meaningful comparison with the terms and conditions offered by other NBFCs can be made and informed decision can be taken by the customer.

(d) The Company shall provide acknowledgment for receipt of loan applications along with the time frame within which loan applications would be disposed-off. Further, the loan application shall be disposed of within the time-period of upto 60 days or such time as mutually agreed upon with the customer.

(e) The Company, at loan application stage, shall indicate all the documents required to be submitted along with the application form.

(f) On exercise of choice, the customer would be given the relevant information about the loan product of his/her choice.

(g) The customer would be informed about the status of his/ her application, as and when required. The Company, while accepting loan application shall explain the entire loan process and journey till the sanction and disbursement of loan.

5. Loan Appraisal and Terms/Conditions:

(a) The company shall convey in writing to the borrower in the vernacular language as understood by the borrower by means of sanction letter or otherwise, the amount of loan sanctioned along with the terms and conditions including annualized rate of interest and method of application thereof and keep the acceptance of these terms and conditions by the borrower on its record.

(b) The company shall furnish a copy of the loan agreement as understood by the borrower 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.

6. Disbursement of Loans including Changes in Terms and Conditions:

(a) The Company shall give notice to all its borrowers of any change in the terms and conditions - including disbursement schedule, interest rates, service charges, prepayment charges etc. The Company shall also ensure that changes in interest rates and charges are effected only prospectively.

(b) Decision to recall / accelerate payment or performance under the agreement shall also be in consonance with the loan agreement.

(c) The Company shall release all securities on repayment of its full dues or on realization of the outstanding amount of loan subject to any legitimate right or lien for any other claim the Company may have against its borrowers.

7. Regulation of Excessive Interest charged

(a) The Company has laid down appropriate internal principles and procedures in determining interest rates and processing and other charges.

(b) The Company has adopted an interest rate model taking into account cost of funds, margin and risk premium for determining rate of interest to be charged for loans and advances.

(c) The rate of interest to be charged depends much upon the gradation of the risk of borrower viz. the financial strength, business, regulatory environment affecting the business, competition, past history of the borrower etc.

8. General

(a) The Company shall refrain from interference in the affairs of the borrower except for the purposes provided for in the terms and conditions of the loan agreement (unless new information, not earlier disclosed by the borrower, has come to the notice of the Company).

(b) In case of receipt of request from the borrower for transfer of borrowal account, the consent or otherwise - i.e., objection of the Company, if any - shall be conveyed to the borrower within 21 days from the date of receipt of any request.

(c) In the matter of recovery of outstanding dues of its Borrower, the Company does not resort to undue harassment viz. persistently bothering the borrowers at odd hours, use of muscle power for recovery of loans/dues, etc.

(d) The Company shall not discriminate on grounds of gender, caste, religion, disability, or any such basis in lending operations.

(e) Customer information shall be treated as confidential and shall not be disclosed to any external party except under regulatory or statutory requirements.

(f) The Fair Practice Code shall be reviewed periodically for continuous improvement and compliance with RBI guidelines.

9. Grievance Redressal Mechanism

Borrowers and others who have grievances in respect of decisions of the Company's functionaries may address their grievances by mail at charan.dhananjayan@kalpathiinvestments.com and by post to, Mr.Charan Dhananjayan, Senior Manager, Kalpathi Investments Private Limited, No.34, Thirumalai Road, T.Nagar, Chennai-600 017.

The Board will periodically review the compliance of this Fair Practices Code and the functioning of the grievances redressal mechanism at various levels of management.

This Fair Practices Code will be available on the website of the Company - www.Kalpathiinvestments.com, for the information of its Borrowers and various stakeholders. Any enhancement(s) or change(s) in the scope of this code will be uploaded from time to time in future on the said website.


Creative Credits: DTX Studios Disclaimer | Privacy © Copyrights Kalpathi Investments, 2007.