Reference Contact Policy

1. Purpose:

Gathering feedback from references before granting a loan is a standard industry practice that helps evaluate the applicant’s credibility and character. Our NBFC responsibly collects and utilizes reference details to conduct checks, ensuring adherence to ethical and regulatory standards. This policy outlines the process for collecting and using reference information, along with the associated responsibilities, liabilities, terms, and conditions applicable to reference contacts.

2. Policy Guidelines:

A. Mandatory Reference Contacts

  • Providing reference contacts is mandatory for all loan applications.
  • Borrowers must ensure the accuracy and availability of reference contacts.

B. Purpose of Collecting References

Reference information is collected to:

  • Gather feedback about the applicant's character and credibility.
  • Validate the authenticity of the applicant during the loan application process.
  • Serve as a point of contact in case the borrower becomes unreachable or defaults on payments.

C. Responsibilities, Liabilities, and Terms for Reference Contacts

  • Responsibilities of Reference Contacts:
    • Reference contacts are expected to provide honest and accurate feedback regarding the applicant's character and credibility.
    • They should offer their endorsement of the borrower's character and act with conscientious judgment.
  • Liabilities of Reference Contacts:
    • Reference contacts are not guarantors and hold no financial or legal obligation to repay the loan.
    • Their role is limited to endorsing the borrower's character and serving as a point of contact for verification or follow-up.
  • Terms and Conditions Applicable to Reference Contacts:
    • Reference contacts consent to be contacted for verification or follow-up.
    • Reference contacts are informed of their limited role and will not be held accountable for the applicant's financial obligations.

D. Usage of Reference Information

Reference information is used to:

  • Verify the borrower's identity and credibility.
  • Conduct follow-ups if the borrower is unreachable or defaults on payments.
  • Provide repayment reminders if dues remain unpaid.

E. Communication with Reference Contacts

Communication will be limited to:

  • Verification of the applicant's credibility.
  • Repayment reminders in case of overdue payments.

Professionalism, respect for privacy, and adherence to regulatory standards will be ensured during all communications. Reference contacts will only be contacted when absolutely necessary and within reasonable hours to respect their time and privacy.

F. Regulatory Compliance

  • The NBFC ensures that all interactions with reference contacts comply with applicable laws and regulations.
  • Reference data is managed in compliance with data protection regulations, including confidentiality and limited access to authorized personnel. It will not be shared with unauthorized third parties.