Indian Banks Offer Rebuttal to Central Bank Collection Guidlines

By Sayli Udas

“We will abide by the Reserve Bank of India’s (RBI) fair-trade practice code, but we will not do away with any of our recovery agents.”
?Neil Chatterjee, Head, Corporate Communications of Standard Chartered Bank.

Despite the RBI’s intentions of cracking down on credit-card operations, banks in Mumbai, India have admitted that recovery agents have become a part of their debt-recovery system and it would be difficult to eliminate them entirely.

“The intimidation and harassment is exaggerated by defaulters,” said Chatterjee, adding that banks do monitor the method of recovery to ensure it happens in a ‘civil’ manner.

“Do we have any other means of recovery?” he asked. “The judicial process in our country is very slow and we are in a business where we need to have a practical approach to recovering debts.”

Most banks would agree. Only a small percentage of customers default on payments and have to deal with recovery agents, they say. And agents, they add, only come into the picture after repeated attempts by bank executives have failed.

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