Friday, May 9, 2014

Prepayment penalty ban only for individual borrowers, says RBI

............The Reserve Bank of India (RBI) on Wednesday clarified that its directive regarding a ban on prepayment penalty on floating rate loans was applicable only for individual borrowers, indicating  it wasn't for corporate clients. “It is advised that banks will not be permitted to charge foreclosure charges/ pre-payment penalties on all floating rate term loans sanctioned to individual borrowers, with immediate effect,” the banking regulator said on Wednesday.........

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