NRB received 103 complaints on loan disputes last fiscal
Nepal Rastra Bank (NRB) received fewer grievances andcomplaints from borrowers or bank and financial institutions (BFIs) on disputesof transactions between the two parties last fiscal year. According to theannual report of the NRB, the central bank's Grievance Management Committeereceived a total of 103 complaints or grievances in the last Fiscal Year2016/17, down from 113 in the previous Fiscal Year 2015/16.
The committee that facilitates in resolving disputesbetween borrowers and BFIs has held the hearing of 33 complaints in the lastfiscal year, according to the annual report of the NRB. For the remainingcomplaints, the central bank has made correspondence with the concernedBFIs.
In a bid to hear grievances if any party feltaggrieved in connection with transactions between a bank or financialinstitution and the borrower, the NRB had set up the Grievance ManagementCommittee following a cabinet decision in 2006. The NRB's deputy governor isthe convener of the committee, whose members include representatives from theMinistry of Finance and the president of Nepal Bankers Association. Arepresentative from the Federation of Nepalese Chambers of Commerce andIndustry (FNCCI) sits as observer in the committee.
However, the central bank informally receivesoverwhelming number of complaints and grievances. Though the annual report doesnot provide exact number of how many complaint cases it received informally, itsaid that it had settled 400 such complaints.
According to the NRB report, most of the complaints are related to the subjectslike extending the maturity period of the loan, discontinuing the auctioning ofthe property pledged as collateral as the auction being not in accordance with the procedures, releasing the collateral as the third party failed to release it on account of mis-utilization of the credit, blacklisting and removal from the blacklist.
NRB brings both the borrower and the bank togetherinto the committee meeting where efforts are made to bring them to mutualunderstanding, say officials at the central bank. The decision of the committeeis communicated to both parties later and is sent for implementation.
“The committee formed in the NRB has helped in solving the problems arising between the BFI and the client. Besides, the function of the committee is also tohelp in minimizing the sorts of problems relating to credit being witnessed inthe banking and the financial sector,” the report added.
Source:MyRepublica, 17th December, 2017
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