The Reserve Bank of India (RBI) has introduced a fresh set of guidelines for banks and financial institutions to regulate loan recovery practices. The new rules emphasize transparency, prohibit harassment of borrowers, and require institutions to provide clear repayment plans before initiating recovery proceedings.
This move is expected to benefit both borrowers and lenders by promoting fair practices and reducing litigation. Experts say the guidelines will also help restore trust in banking relationships and prevent exploitation during financial distress.