BCC:BR:107/ CIRCULAR TO ALL BRANCHES AND OFFICES IN INDIA

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Nathaniel James
6 years ago
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1 BCC:BR:107/ CIRCULAR TO ALL BRANCHES AND OFFICES IN INDIA Dear Sir, ISSUED BY RETAIL BANKING DEPARTMENT DEPARTMENT Sub File: ADV - 2 Re: Baroda Loan to Pensioners Modifications. Baroda Loan to Pensioners was launched in September, 2000 for catering to the needs of retired employees and for meeting changing needs of the target group. The product was modified from time to time. On realignment of Retail Loan products, w.e.f , Loan to Pensioners is merged with Baroda Personal Loan. We have been receiving requests from our operational units to modify the parameters of Loan to Pensioners to widen its scope and make it more competitive. Accordingly it has been decided to modify the following parameters of Loan to Pensioners. S. Scheme No Parameter 1. Eligible borrowers Existing Guidelines Pensioners: Pensioners aged not more than -70- years and drawing pension through the branch atleast for last -6- months. Defence Pensioners: Retired Defence Personnel drawing pension from the branch. Spouse of late pensioner drawing family pension from the branch. Pensioners those who retired from para military forces viz. B.S.F etc are not covered. Revised guidelines Target group: Regular Pensioners, Family Pensioners Retired Employees of Bank of Baroda/ their Family pensioners Eligibility: Pensioners/ family pensioners drawing pension through our Bank s branches. Pensioners who are getting their pension disbursed through Treasury/DPDO (Defence Pension Disbursing Office) directly to the credit of their savings accounts with our branches.

2 Pensioners/ Family Pensioners of our Bank. Family Pensioner: Spouse authorised to receive pension after the death of the pensioner. Pensioner should be drawing pension through the branch for at least last -3- months and his account should have been conducted satisfactorily. i.e., no return of cheques for financial reasons. 2. Age Minimum: 21 Years Maximum: Pensioners: 70 years. Defence Pensioners: Spouse of late pensioner, drawing family pension: 65 years Others : 68 years Minimum: 21 Years Maximum: 75 years 3. Maximum Amount Loan to Pensioner: 10 times of monthly pension Max Rs Lac whichever is lower Loan to defence Pensioner: 20 times of monthly pension Max. Rs.2.00 Lac whichever is lower 18 times of monthly pension with a ceiling of: Regular Pensioners: For age upto 70 years : Rs.8.00 Lacs For age above 70 years: Rs.5.00 Lacs For Family pensioner: For age upto 70 years : Rs.3.00 Lacs For age above 70 years : Rs.1.50 Lacs Total monthly deductions including proposed EMI and EMIs of existing loans (if any) should not exceed 60% of monthly pension.

3 4. Rate of Interest Base Rate % i.e, 14.75% at present Base Rate % i.e % at present. 5. Repayment Period 6. Unified Processing charges 7. Opening /reporting of Loan to Pensiones 8. Other Conditions For Retired Employees of Bank of Baroda/ their Family pensioners: Base Rate. i.e., 10.25% at present 36 months Regular Pensioners/Family Pensioners: For age upto 70 years : 60 months For age above 70 years : 36 months Rs.500/- Pensioners / Family Pensioners of our Bank : Nil Others : Rs.1,000/- On realignment of Retail Loan to Pensioners to be Loan products, w.e.f. opened/ reported separately , Loan to as Baroda Loan to Pensioners was merged Pensioners in separate with Baroda Personal scheme code. However, Loan. portfolio to be reported under Personal/Clean Loans. (Finacle scheme code: LA147 & Ascrom scheme code: 63) _ Branches to endeavor to obtain Assignment of LIC policy, if the applicant is already having Life Insurance Cover The revised product profile of Baroda Loan to Pensioners is attached as Annexure- 1. With the modified features, our branches will find Baroda Loan to Pensioners as highly competitive and attractive product in respect of all the major parameters rate of interest vis a vis similar products of Peer Banks. We are sure that branches will make all out efforts to increase this safe and remunerative advance which eventually will help in increasing healthy retail lending portfolio. Yours faithfully, (Rukmini V) General Manager (Retail Banking)

4 Annexure-1 Baroda Loan to Pensioners Product Profile Purpose Target Group Eligible Borrowers For any purpose other than speculation. Regular Pensioners, Family Pensioners Retired Employees of Bank of Baroda/ their Family pensioners Pensioners/ family pensioners drawing pension through our Bank s branches. Pensioners who are getting their pension disbursed through Treasury/DPDO (Defence Pension Disbursing Office) directly to the credit of their savings accounts with our branches. Pensioners/ Family Pensioners of our Bank. Family Pensioner: Spouse authorised to receive pension after the death of the pensioner. Pensioner should be drawing pension through the branch for at least last -3- months and his account should have been conducted satisfactorily. i.e., no return of cheques for financial reasons. Age Loan Limit Minimum: 21 Years Maximum: 75 years 18 times of monthly pension with a ceiling of: Regular Pensioners: For age upto 70 years : Rs.8.00 Lacs For age above 70 years: Rs.5.00 Lacs For Family pensioner: For age upto 70 years : Rs.3.00 Lacs For age above 70 years : Rs.1.50 Lacs Total monthly deductions including proposed EMI and EMIs of existing loans (if any) should not exceed 60% of monthly pension. Repayment Period Regular Pensioners/Family Pensioners: For age upto 70 years : 60 months For age above 70 years : 36 months

5 Rate of Interest Base Rate % i.e., 12.25% at present. For Retired Employees of Bank of Baroda/ their Family pensioners: Base Rate. Penal interest Penalty for Prepayment Unified Charges Processing Security Documents Documents Required to be submitted by applicants Risk rating Penal shall be levied on overdue amount --NIL Pensioners / Family Pensioners of our Bank : Nil Others : Rs.1,000/- 1. DP Note 2. Letter of installment with Acceleration clause 3. Declaration cum Undertaking cum Authority 4. Authority letter to recover monthly installment from pension account - Annexure- 1(a) 5. Undertaking from Legal heirs to pay banks dues in the event of death or default by the pensioner (Not to be obtained if wife is alive or personal guarantee of person nominated to receive family pension is obtained as a condition of the sanction) Annexure 1 (b) 6. Letter from the Pensioner undertaking not to transfer the pension payment, during the currency of the loan, to any other branch of our Bank/ other Bank without prior written consent of the Branch Annexure 1(c) 7. Personal guarantee of wife, if alive, or personal guarantee of person nominated to receive family pension (in case the nominee is a minor, guarantee of the guardian of the minor is to be obtained) 8. Assignment of existing Life Insurance Policy, if available (i.e., it is not a precondition for sanction. Branches should endeavor to obtain Assignment of LIC Policy, if the applicant is already having Life Insurance Cover) 1. Application form as per Annexure- 1 (e) 2. Passport Size Photograph 3. Identity proof 4. Residence /Address Proof 5. Details of Pension /PPO No. etc. Credit rating will be done as per existing guidelines under Clean Loan Rating Model and Loan shall not be extended to the borrowers getting scores below cut-off mark. Cut off Score is 30 & Investment Grade is CL 7 & above. Revised Product Profile : Baroda Loan topensioners Page 2

6 Other Conditions Monthly installments to be recovered from the pension paid by the branch every month on the date of payment of pension without fail. Proper noting is to be made in the borrower s pension file regarding granting of the loan to ensure that the pension payment is not transferred to any other branch/bank during the currency of the loan. CIBIL data in respect of applicant should be verified. Lending Powers Powers of Deviation Letter to Pensioners DLPs of Clean Loans shall be exercised by the Sanctioning Authority. Financial/non-Financial Deviations/Concessions in respect of scheme parameters/ guidelines may be considered as per other retail loans as per Circular No.BCC:BR:106/22 dated Branches can send letter to those pensioners who satisfy basic criteria of loan to pensioners under Personal Loan scheme. A draft Pre-approval letters is given in Annexure- 1 (d) which may be sent to the pensioners after filling up the necessary information in it. Scheme Codes Finacle: LA147 Ascrom: 63 Revised Product Profile : Baroda Loan topensioners Page 3

7 Annexure - 1(a) DRAFT OF THE LETTER TO BE ADDRESSED BY THE PENSIONER/BORROWER TO THE BANK In consideration of your having at my request granted/agreed to grant me a loan of Rs. interalia against a Demand Promissory Note to be executed by me, I Mr./Mrs./Ms. hereby irrevocably authorise you to deduct a sum of Rs. from the monthly pension payable to me for the month of 20 and onwards until the loan together with interest, cost charges and expenses is fully adjusted. It is on the faith of my giving consent/authority as above you have agreed to grant the loan to me against the pension payable to me. ================================================================= Annexure- 1 (b) DRAFT UNDERTAKING FROM LEGAL HEIRS (Stamp as in agreement) In consideration of Bank of Baroda granting a loan of Rs. to my father/mother/husband/wife Mr./Mrs. against the monthly pension payable to him/her, I/We, Mr./Mrs./ Ms. stand as guarantor/s to the advance upto Rs.. In the event of my father/mother/husband/wife's death before the said loan together with interest is repaid, I/We, undertake to pay Bank of Baroda whatever amount is due under the said loan availed by Mr./Mrs. including interest,cost charges and expenses. It is in the faith of our consent/undertaking as above you, Bank of Baroda have agreed to sanction the loan to Mr./Mrs. against the pension payable to him/her.

8 Annexure - 1 (c) (Unstamped) DRAFT OF THE LETTER TO BE ADDRESSED BY THE PENSIONER / BORROWER TO THE PENSION DISBURSING AUTHORITY To : THE PENSION DISBURSING AUTHORITY I have availed/been sanctioned a loan of Rs. against the pension payable to me from/by the Branch of Bank of Baroda. I Mr./Mrs./Ms. hereby irrevocably authorise you not to transfer the payment of pension from Branch of Bank of Baroda, to any other Bank/any other Branch of Bank of Baroda, without the prior written consent of Branch of Bank of Baroda.

9 Annexure - 1 (d) Draft of the Approval Letter to be sent to pensioners on Branch s Letter Head. Shri... Dear Sir, Re: Baroda Loan to Pensioners. We are pleased to inform you that we have approved a loan of Rs. /- under our Baroda Loan to Pensioners scheme. Basic terms and conditions for the loan are as under: Amount Rate of Interest : Rs.. :...% p.a. with monthly rest. Repayment : In EMIs of Rs. each, commencing w.e.f. one month after availment. Other conditions : 1. Interest is charged on daily reducing balance method. 2. No pre-payment charges. We request you to call on us on any working day during office hours to complete the formalities and execution of relative documents. This approval is valid for three months from the date of this letter. Should you require any clarification / information, you may contact Shri.. (Phone Number.) attached to our branch. Yours faithfully, ( ) Chief / Senior /Branch Manager

10 The Chief/Senior Branch Manager Branch Dear Sir/Madam, Re : Baroda Loan to Pensioners Application form for Baroda Loan to Pensioners I/We hereby apply for a loan of Rs. (Rupees ) for (purpose) under your scheme "Baroda Loan to Pensioners". I/We have read the terms & conditions of your scheme and hereby agree to abide by the same. I/We hereby submit below the particulars as required by you to enable you to do the needful. 1 NAME IN FULL 2 FATHER'S NAME 3 DATE OF BIRTH/ AGE 4 ADDRESS: PRESENT APPLICANT CO-APPLICANT CONTACT TEL./ PERMANENT CONTACT TEL./ 5 TYPE OF PENSIONER Central Civil / Defence / Railway / State Govt. / BOB / Other 6 PPO Number Central Civil / Defence / Railway / State Govt. / BOB / Other 7 Pension SB A/c No. 8 Drawing pension through the Branch since 9 Gross Monthly pension 10 Total Deductions 11 Net Monthly Pension 12 OTHER INCOME (including that of family members : Please specify) 13 Details of Nominee for Family Pension Name (if minor, name of Guardian) RELATION AGE ADDRESS

11 14 Details of Legal Heirs NAME (If minor, name of Guardian) RELATION AGE ADDRESS 15 Details of loan availed from the Bank TYPE OF LOAN AMOUNT BALANCE OUTSTAND ING MONTHLY INSTALMENTS I/We hereby declare that all the particulars and information furnished herein above are true, correct and complete and they shall form the basis of any credit decision to be taken by the Bank. Date : Place : (Signature of Applicant) (Signature of Co-applicant) Recommended for sanction : Sanctioned as recommended : Amount : /- purpose (Rupees ) No. of instalments Rs. /- per month Rs. /- per month + Monthly Interest. Security/Documents (Tick whichever is applicable) (a) DP Note signed by the Borrower ( ) (b) Personal Guarantee of Nominee ( ) (c) Letter of Installment ( ) (d) Authority letter from borrower ( ) (e) Undertaking from Legal Heirs ( ) (f) Letter of undertaking by borrower ( ) Any Other (g) ( ) (h) ( ) (i) ( ) (Signature of Credit Officer) (Signature of Sanctioning Authority) Date : Place : Date : Place :

3/6, Siri Fort Institutional Area, August Kranti Marg, New Delhi Ph: , , , , Fax :

3/6, Siri Fort Institutional Area, August Kranti Marg, New -110049 Ph: 2649 5506, 2649 6507, 2649 4508, 2649 7509, 2649 5635 Fax : 2649 6332 LOAN APPLICATION FOR SWAPPING OF LOAN OF OTHER HOUSING FINANCE