R.K. Bansal Finance Private Limited (“the Company” / “RKBFPL”), a Non-Banking Financial Company (NBFC – Base Layer) registered with the Reserve Bank of India (RBI), is committed to adopting fair, transparent, ethical, and legally compliant recovery and collection practices. This Recovery and Collection Policy (“Policy”) is framed in alignment with:

RBI Act, 1934 and applicable RBI Master Directions for NBFCs
RBI Fair Practices Code Guidelines
RBI Digital Lending Guidelines and outsourcing norms

This Policy governs all recovery and collection activities of the Company and forms an integral part of the overall credit governance framework, ensuring consistency across loan origination, servicing, recovery, settlement, and write-off stages.

2. OBJECTIVES OF THE POLICY

The objectives of this Policy are to:

Establish a structured, transparent, and RBI-compliant recovery framework
Ensure dignified, non-coercive, and borrower-friendly recovery practices
Protect borrower rights, privacy, and confidentiality
Minimize delinquencies and credit losses through timely intervention
Clearly define escalation, settlement, and write-off processes
Ensure accountability of employees and outsourced recovery agents

3. APPLICABILITY

This Policy shall apply to:

All loan products offered by the Company including payday loans, personal loans, EMI-based loans, LAP, and business/corporate loans
All recovery actions undertaken by in-house teams or outsourced agencies
All employees, officers, representatives, and third-party service providers engaged in recovery and collection

4. GUIDING PRINCIPLES

The Company shall adhere to the following principles:

Fairness and Respect: Borrowers shall be treated with dignity and respect at all times
Transparency: Clear communication of dues, charges, consequences, and options
Non-Coercion: No harassment, intimidation, abuse, or force
Confidentiality: Borrower data shall be protected and used strictly for recovery purposes
Legal Compliance: All actions shall be within the framework of applicable laws and RBI directions

5. RECOVERY GOVERNANCE STRUCTURE

Overall oversight shall vest with the Board of Directors / Board Risk Committee
Day-to-day recovery operations shall be managed by the Collections Department
Legal actions shall be routed through the Legal Department
Settlement and write-off decisions shall be governed by the Settlement & Write-off Policy

6. RECOVERY MECHANISM

6.1 Product-Specific Alignment with Credit Policy

The recovery and collection framework for payday loans shall be strictly governed by the Company’s approved Credit Policy, particularly:

Section 6: Collection Risk Strategy
Section 6.1: Delinquency Management Framework
Section 6.2: Escalation & Write-Off Protocols

Given that Payday Loans are short-tenure, bullet repayment loans (6–40 days) with relatively higher risk pricing, the recovery strategy emphasizes early intervention, structured escalation, and time-bound resolution, while ensuring full compliance with RBI Fair Practices Code and borrower protection norms.

6.2 Delinquency Identification and Account Classification

An account shall be treated as overdue if the full repayment amount (principal, interest, and applicable charges) is not received on the due date.
Days Past Due (DPD) shall be computed from the day immediately following the due date.
All recovery actions shall be mapped to DPD buckets as defined below.

6.3 DPD-Based Recovery and Escalation Framework

DPD Bucket	Classification	Recovery Actions
0–5 DPD	Soft Follow-up	Automated SMS, email, app notifications; courtesy calls by in-house team to identify technical issues, salary delays, or inadvertent omissions. No pressure tactics permitted.
6–15 DPD	Escalated Follow-up	Structured outbound calls by trained collection executives; clear communication of dues; obtaining documented Promise-to-Pay (PTP); explanation of consequences of continued default.
16–30 DPD	Intensive Recovery	Assignment to senior collectors; authorized field visits where required; issuance of formal demand notices; evaluation for legal action. Field visits must strictly follow RBI conduct norms.
>30 DPD	Final Recovery	Initiation of legal recovery proceedings; evaluation for write-off; transfer to specialized recovery agencies where approved.

6.4 Telephonic and Digital Recovery Process

Telephonic recovery shall be conducted only by trained personnel using approved scripts.
Contacts shall be made only between 8:00 AM and 7:00 PM
Digital communication shall comply with RBI Digital Lending Guidelines
No access shall be taken to borrower contacts, gallery, or personal data.
Frequency of communication shall be reasonable and proportionate to the DPD status.

6.5 Field Collection Process

Field visits shall be initiated only after exhaustion of telephonic efforts and normally after 15 DPD.
Recovery agents shall carry valid authorization letters and identity cards.
Visits shall be conducted during permitted hours and in a dignified manner.
Under no circumstances shall agents indulge in public shaming, intimidation, or coercion.
Special care shall be taken in cases involving elderly borrowers, women borrowers, or vulnerable customers.

6.6 Legal Recovery Actions

Legal action shall be considered only after reasonable opportunities for repayment have been provided.
Legal measures may include issuance of demand notices, arbitration, civil proceedings, or other remedies as permitted by law.
All legal actions shall be approved by the designated authority as per the internal approval matrix.

6.7 Settlement, Restructuring, and Compromise

Settlement or restructuring may be considered on a case-to-case basis, based on borrower profile, repayment intent, and recovery potential.
Any compromise or waiver shall require prior internal approvals.
Settlement terms shall be documented in writing and communicated transparently to the borrower.

6.8 Write-Off Policy

Accounts exceeding 30 DPD and assessed as uncollectible may be considered for write-off for accounting purposes.
Write-off shall not extinguish the borrower’s liability.
Post write-off recovery efforts may continue through legal means or empaneled recovery agencies.

6.9 Recovery Agency Management

Recovery agencies shall be appointed after due diligence and RBI-compliant agreements.
Agencies shall follow this Policy, Fair Practices Code, and RBI Code of Conduct.
The Company shall remain fully responsible for the acts of its recovery agents.

6.10 Monitoring, MIS and Governance

Recovery performance shall be monitored through MIS aligned with the Credit Policy, including:
- DPD bucket movement
- Bounce trends
- Risk-grade-wise delinquency
- City-wise and device-wise delinquency trends
Deviations from approved recovery strategy shall be escalated to senior management.

7. CONDUCT OF RECOVERY STAFF AND AGENTS

Recovery staff and agents shall:

Carry valid authorization and identity proof
Clearly identify themselves and the Company
Be courteous, professional, and non-threatening
Not use abusive language or make false representations
Not threaten arrest, imprisonment, or legal action without basis
Not contact borrowers’ relatives, friends, or employers except as legally permitted

8. FIELD VISITS

Field visits shall be conducted only when necessary
Visits shall respect borrower privacy and social standing
No public humiliation or display of borrower information
Female borrowers shall not be visited by male agents alone

9. DIGITAL AND TELEPHONIC COLLECTION

Digital communication shall comply with RBI Digital Lending Guidelines
No unauthorized access to borrower’s contacts, gallery, or personal data
All digital communications shall be auditable and traceable

10. LEGAL RECOVERY ACTIONS

Legal recovery actions shall be initiated strictly as a measure of last resort, after exhaustion of amicable and operational recovery efforts.
All legal actions shall be consistent with the loan agreement, Fair Practices Code, and applicable laws.
Borrowers shall be given reasonable notice and opportunity before initiation of legal proceedings.
Legal recovery shall be approved as per the internal authority matrix and documented appropriately.

11. SETTLEMENT, RESTRUCTURING AND WAIVER

Settlement, compromise, or restructuring shall be governed by the Company’s Comprehensive Policy on Settlements & Write-offs.
Settlements may be considered for accounts with DPD > 30 days, NPAs, written-off accounts, or cases involving genuine borrower hardship.
No settlement or waiver shall be granted arbitrarily or as a recovery shortcut.
Settlement approvals shall be strictly as per the Delegation of Authority defined in the Settlement & Write-off Policy and shall be one level higher than the loan sanctioning authority.
Borrowers shall be informed about the credit bureau impact of settlement or write-off prior to acceptance.
All settlement terms shall be communicated in writing, including payable amount, waived amount, timelines, and consequences of non-compliance.

11A. WRITE-OFF

Write-offs shall be technical write-offs only and shall not extinguish the borrower’s liability.
Written-off accounts shall continue to be pursued for recovery, settlement, or legal action.
Re-aging of accounts is strictly prohibited.
Accounting treatment and provisioning shall be in accordance with RBI norms and the Settlement & Write-off Policy.
The Company may consider restructuring, rescheduling, or settlement on a case-to-case basis
Any waiver or compromise shall follow internal approval

12. CONFIDENTIALITY AND DATA PRIVACY

All borrower information, records, call recordings, field visit notes, and recovery-related communications shall be treated as strictly confidential.
Access to borrower data shall be restricted to authorised personnel strictly on a need-to-know basis for recovery and compliance purposes.
The Company shall comply with RBI Digital Lending Guidelines, Information Technology Act, 2000, and applicable data protection and privacy laws while handling borrower data.
Recovery agents shall not copy, store, misuse, or share borrower data in any physical or electronic form.
Any data breach, misuse, or unauthorised disclosure shall attract strict disciplinary action, termination of contracts, and legal proceedings, as applicable.

13. BORROWER COMMUNICATION AND DISCLOSURES

All recovery-related communications shall be factual, transparent, non-misleading, and respectful.
Borrowers shall be clearly informed of:
- Total outstanding amount with breakup of principal, interest, penal charges, and other dues
- Consequences of continued default
- Available repayment, restructuring, or settlement options, where applicable
Any levy of penal charges or overdue charges shall be communicated along with the specific reason for such levy.
Communications shall be made, as far as practicable, in a language understood by the borrower.

14. GRIEVANCE REDRESSAL MECHANISM

The Company shall maintain a robust grievance redressal mechanism for complaints relating to recovery and collection practices.
Borrowers may lodge complaints through the channels specified in the Fair Practices Code, including email, written communication, or customer support channels.
Complaints alleging harassment, coercion, misrepresentation, or misconduct by employees or recovery agents shall be investigated on priority.
All grievances shall be resolved within the timelines prescribed by RBI.
Where the borrower is not satisfied with the resolution, escalation to the RBI Ombudsman / Department of Supervision shall be facilitated in accordance with applicable guidelines.

15. TRAINING, SUPERVISION AND AUDIT

The Company shall conduct regular training programmes for employees and recovery agents covering RBI recovery guidelines, Fair Practices Code, borrower rights, and ethical conduct.
Telephonic calls, digital communications, and field visits may be recorded, monitored, and audited for quality, compliance, and behavioural standards.
Internal audit and compliance teams shall periodically review recovery operations, outsourced agencies, documentation, and adherence to this Policy.
Observations and non-compliances identified during audits shall be promptly addressed and reported to senior management.

16. DISCIPLINARY ACTION AND ZERO-TOLERANCE POLICY

The Company follows a zero-tolerance approach towards harassment, coercion, intimidation, abuse, or any unethical recovery practice.
Employees violating this Policy may face disciplinary action including warning, suspension, recovery-linked penalties, or termination.
Recovery agencies found in violation shall be immediately suspended or terminated and may be permanently blacklisted.
Serious violations may be reported to regulatory authorities or law enforcement agencies, wherever required.

17. REVIEW AND AMENDMENT

This Policy shall be reviewed at least annually by the Board of Directors or earlier if required due to regulatory changes, RBI circulars, or business needs.
Any amendment to this Policy shall require prior approval of the Board of Directors.

18. BOARD APPROVAL AND EFFECTIVE DATE

This Recovery and Collection Policy has been approved by the Board of Directors of R.K. Bansal Finance Private Limited at its meeting held on 21^st April, 2025 and shall be effective from the same day.

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