Advance Payments of the Loan Amount will Reduce Penalty: Reserve Bank Order
Due to the varying interest rates implemented on the loans, the penalty should not be imposed on the case of advance payments, ordered Reserve Bank of India.
This rule will immediately
come for implementation, says Reserve Bank senior management.
In favor of the
customers, advance closure of the loan will be allowed without imposing the
penalty. Reserve Bank of India says that if the customers are coming forward
with their own interest of advance closure of the principal amount, bank
management should not involve in any mal practices of imposing penalty or
interest rate alterations.
Banks should not take
the loan closure circumstances of their customers in favor for them.
During the meeting held
up on April 1, this announcement has been made by the Reserve Bank of India.
There should not be any penalty imposing on the housing loans with varying interest rates, stated by Reserve Bank of India during April, 2012. Hence, many customers have changed their loan to the banks which accounts for lower interest for their housing loans.
