Why is the bank charging incorrect EMI and withholding insurance policy?
My father took a loan from state bank of India of 260000. It is clearly written in the agreement that EMI of 5538 for 60 months would repay the loan amount but the bank recovered from my father EMI of 5800 for 72 months and the bank also did loan protection policy but not giving the original insurance policy?
You can sue if your father's loan agreement says EMI ₹5,538 for 60 months but the bank charged ₹5,800 for 72 months. The process is: file a complaint with the bank's grievance redressal mechanism and seek a detailed explanation of discrepancies; in case not resolved, raise it with the Banking Ombudsman who may help to resolve disputes. The original insurance policy can be demanded in writing and legal advice should also be sought if the bank does not provide it. In case of defaults, consider filing a complaint for unfair practices before consumer court to get compensation.
Initially, formally request the bank to provide the original loan protection policy document. Under Section 6 of the RTI Act (Right to Information Act 2005), you can ask the details of the insurance policy if the bank does not comply voluntarily. Lodge a written complaint with the bank and request the resolution. Banks are bound by the Banking Codes and Standards Board of India (BCSBI) to address the customer grievances promptly. If the bank fails to resolve issue within 30 days, you can file a complaint with the Banking Ombudsman under the Reserve Bank of India under Banking Ombudsman Scheme, 2006. If you suffer financial loss due to these discrepancies, you can file a complaint in the Consumer Forum under the Consumer Protection Act 2019.
Sir, firstly you should review the loan agreement to ensure the terms, including the EMI amount and if it is found that the bank is charging more than the agreed EMI or extending the loan tenure without your consent then this could be a violation of the agreement. If the bank refuses to resolve the matter then you can file a formal complaint to relevant authority. It is advised to consult an expert lawyer who will assist you in understanding your rights and options. For further legal assistance contact us on our helpline number.
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