Explain the various provisions of principles of lending.

According to the principles of bank lending, the banks must give a timeline within which loans of up to Rs. 2 Lacs will be disposed off and they must provide acknowledgement for the receipt of loan applications. Not only this, they should also give appropriate reason in writing in case of rejection of the loan application that amounts up to Rs. 2 Lacs. The lenders must do a proper credit assessment of the borrower. They must conduct due diligence. The lender must convey credit limits, terms and conditions and seek acceptance of the borrower in writing for the same. The rules stipulate that lenders must timely disburse the loan amount in their loan accounts. An intimation of all the terms and conditions, changes (if any), interest rates, etc. Must be communicated to the borrower The lender should not engage in any sort of discrimination based on the sex, caste and religion.

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