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HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED

FAIR PRACTICES CODE

Intent and Content

  • This Code has been formulated by Housing Development Finance Corporation Limited (the Corporation) pursuant to the Guidelines issued by the National Housing Bank on Fair Practices Code for Housing Finance Companies vide its circular bearing No. NHB(ND)/DRS/POL- No. 16/2006 dated September 05, 2006. This Code has come into force from 19th October, 2006 which has been modified pursuant to the Guidelines issued by the National Housing Bank on Fair Practices Code for Housing Finance Companies vide its circular bearing No. NHB(ND)/DRS/POL- No. 34/2010-11 dated October 11, 2010 and has been effective from December 23, 2010 . The said Guidelines has been further modified by the National Housing Bank on Fair Practices Code for Housing Finance Companies vide its circular bearing No. NHB(ND)/DRS/POL- No. 38/2010-11 dated April 25, 2011. This Code has come into force from May 10, 2011.

Objectives

  • Follow good, fair and transparent business practices by setting reasonable standards;
  • Encourage market forces, through fair competition, to achieve higher operating standards;
  • Relate to the customer in such manner so as to promote a fair and cordial relationship;
  • Set such standards and practices so as to foster confidence in the housing finance system.

Application

  • To be applicable to all persons offering the Products and Services of the Corporation as an employee or otherwise in any manner and/or by any mode.
  • The Code is applicable under normal operating environment except in the event of any force majeure.
  • The Code is based on ethical principles of integrity and transparency and all actions and dealings shall follow the spirit of the Code.

Commitment

  • The Corporation shall at all times do its best to act fairly, reasonably and meet the standard practices prevalent in the housing industry.
  • The Corporation shall abide by all the relevant laws, regulations and meet with the ethical principles of integrity and transparency during its interaction with customers.
  • While interacting with customers, the Corporation may take all steps as may be required to provide clear information either in English or Hindi or the appropriate local language regarding:
    • its various products and services;
    • the terms and conditions, the interest rates/service charges;
    • benefits available to customers and the implications, if any;
    • contact persons for addressing the queries, if any;
  • The Corporation will provide a copy of this Code, at request, to the customer. The Code will also be made available on its Website and at every branch/ office.
  • The Corporation would not discriminate on grounds of sex, caste and religion in the matter of lending. However this does not preclude the Corporation from participating in credit-linked schemes for the weaker sections of society and in respect of schemes formulated by NHB/ other Government Agencies, implemented through the Corporation.
  • The Corporation shall treat the information relating to customers as strictly confidential and shall not share any information, unless required under law or waived or permitted by the customer.
  • The Corporation shall take necessary steps to inform its customers of their right to information regarding their account and the facilities available to them.
  • The Corporation shall be clear and not misleading in any of its advertising and promotional materials.
  • The Corporation shall inform its customers of all financial information such as rates of interest, charges, method of calculation etc through brochures, posters or during the course of meeting with the customers etc prior to entering into any transaction.
  • The Corporation shall endeavor to keep its customers informed of any change in interest rates / charges etc through letters or any other form of general or public announcement or displays, from time to time.
  • The Corporation shall disclose, by such mode and in such manner as deemed fit, to ensure transparency, all information affecting the interest of the borrower including but not limited to :
    • fees/charges payable for processing loan application;
    • the amount of fee refundable, if any, if the loan amount is not sanctioned;
    • Prepayment options and charges, if any;
    • Penalty for delayed payment, if any;
    • Conversion charges (Switching loan from fixed to floating rate or vice –versa);
    • Existence of interest re-set clause, if any.
  • The disclosure shall be done so as to ensure that the borrower is aware of “all in cost” parameters involved in processing and sanctioning of loan. The Corporation shall not indulge in any act which is discriminatory among equals.
  • The Corporation will review the compliance of this Code and a consolidated report of such review may be submitted to the Board.

Loans

  • The Corporation in the normal course of its business shall endeavour at all times to guide its customers about the process and procedure to be followed for availing a loan.
  • Each application shall be considered independently on merit, upon scrutiny of all the information, documents required for verifying the title of the property, identity of the person, entity and the security to be offered, including guarantees.
  • The letter of guarantees to be executed by the guarantors would cover their obligations, liabilities and circumstances in which they can be called upon to pay the dues of the customer/borrower.
  • The Corporation shall communicate in writing to the customer whose application has been rejected.

Collection of Dues

  • The Corporation shall provide the customers with all the information regarding their dues and provide reasonable time for payment of the same.
  • The Corporation shall while protecting its interest adopt reasonable and lawful measures to recover its dues from defaulting customers, including use of persuasive methods for the purpose of collection of its dues.

Complaints and Grievances

  • The Corporation shall endeavour to address/respond to all complaints and grievances within a reasonable time and keep the customers informed about the status of their complaints.
  • The Corporation shall make available facilities at each of its branches and offices for the customers to lodge and/or submit their complaints or grievances, if any.
  • The Corporation will ensure that its grievance redressal procedure is made available on its website.