Personnel Loans!!!

[k1jatrophaoils]

I just wanted to smell the activities of CITI FINANCIAL who are supposed to be one of the biggest Non-Banking Financial Institution who lend money in the consumer's interest.
I got hold of one DSA here in Davengere namely Guruprasad to arrange
me a Personnel loan Rs50000/.This was in aug2006.
He took few documents and informed me that Iam eligible for a loan of Rs35000 after verifying my IT returns and other papers.
He wanted me to meet his Branch Head Rahul Jhadav who finally gave a Cheque of ING Vysya Bank favouring me a sum of Rs32140 after deducting the first EMI Rs2071/ and some other charges out of Rs35000.00
Friends!Here are those hidden missiles or Suicide Bombs!!!!!
I was asked to Insure for a sum of Rs200000/and was told that this totally free of cost.
I was asked to hand over twenty blank cheques and the Branch head told me that the ROI will be 19% per annum.(No.ofEMIs not disclosed)
I was shocked to see a cheque being presented by Tata AIG as if I agreed to pay a Half yearly premium a sum of Rs4100/.immediately on presentation of the loan amount sanctioned in my Bank (UTI) account.
Things did not stop here.
The citi finacial people not only mis used my cheque for the purpose of a Insuarance Business which was not agreed upon but also collected a heavy interest of Rs10400/ for this principal amount of Rs35000/ when I Pre-closed this fraudulent transaction few days ago.
Here its!
I borrowed this money five months back Aug2006 and cancelled the account three days back and in the process I lost around Rs14000/ in the name of genuine Interest and hurdle free Personnel Loan.
Friends!
I will initiate proper legal actions against this fraudelent company which is something like a Chit company! which voilates RBI's norms and will expose its credentials with proof.
I also warn people to be very cautious with such Financial organisations while borrowing!!!!!!
Once again!
Principal amount: Rs35000.00
Insuarance :Rs4100.00
Interest :10400.00
Duration of this Transaction: just five months.
Bhadrinath.

[darshakm]

Dear Mr. Bhadrinath,

I totally agree with you that you have been taken for a big ride.

To best of my understanding on personal loans from private banks, please note details as follows:-

they're supposed to take only following cheques:-

1. One cheque blank, cross and cancelled. this is for your bank signature verification proof. in case you've given a signature proof from your bank seperately with your photo graph duly attested by your bank, you need not give this cheque.

2. one cheque, crossed , duly filled in, but undated for the value of loan amount.

3. two / three undated cheques crossed , duly filled in, but undated for the value of EMI.

for your EMI'S, you're supposed to sign an ECS mandate (electronic clearing of EMI ) every month with your bank a/c. no.

YOU'RE NOT SUPPOSED TO GIVE ANY BLANK CHEQUES, EVEN IF YOU'VE NOT SIGNED ECS MANDATE FOR EMI'S.

IN CASE YOU DO NOT SIGN EMI MANDATE, YOU'RE SUPPOSED TO GIVE PROPERLY FILLED CROSSED CHEQUES WITH YOUR LOAN ACCOUNT NO.
ONCE YOUR LOAN IS SANCTIONED THEY'RE SUPPOSED TO GIVE YOU A LOAN A/C NO.

As regards insurance, when they give you the nett amount, they deduct a one time premium for personal loan amount, in case, something happens to you, they can claim the loan amount from insurance company directly and close your account. this is donwe because it's an unsecured loan, there are no gurantors / collaterals / your family members involved in loan.

from your end, whenever you issue cheques to bank, you're supposed to take acknowledged receipt of blank cheques given to bank.

i've tried to give you insignt into what is general practise prelevant by various private banks.
it would not be right on my part to comment on the specifics in your case, but i hope these inputs are helpful to you.

I request all other members of forums to be careful while dealing with loans.

Darshak Mehta

[k1jatrophaoils]

Thank you for your encouraging reply.

I found two things in this issue.
The Citi financial is nothing but a sort of Chit company.
The Insuarance cover up of Rs200000/for a loan of Rs35000/ and that too in collision with Tata AIG seems to be something special.

The no mention of ROI in their covering letter while releasing the loan seems to be a secret arrangement with ING vysya Bank and in fact voilating RBI norms I feel.

I await for the authenticated letter from Citi Finacial New delhi and only then I will approach the court of law to bring out the truth.

Certainly!
I suspect something going wrong in a Corporate MNC group in India.
Bhadrinath.

[k1jatrophaoils]

Here is one more arrogance.
The Citi financial though collected the entire principal amount with huge interest they have not returned back my cheques issued at the time of securing loan.
They in fact presented a cheque this month and my Bank UTI have collected a penalty for bouncing the cheque.
When asked CIti Financial's executives in Davengere,they say that its a mistake and the cheques are presented from Delhi as if they can escape from this fraudalent transactions.
I await for my papers to come and then Iam sure to file a suit against this MNC who betray many in the name of personnel loans.
Bhadrinath.