Banking: Prashant Joshi

My father and uncle started a company in 1992. They took a bank loan, giving my house as collateral. My father resigned from the firm’s directorship in 1996. Despite his repeated requests, the bank did not release my house and kept enhancing the company’s debt limit based on it. In 2000, the company became a non-performing asset. The bank has since been trying to recover its dues from our property.
The person who had provided security/guarantee is liable to repay the loan even after leaving the company till the current owner/director provides acceptable replacement of that security/guarantee to the bank. The bank has the right to recover the funds by taking over possession of the property under the SARFAESI Act. The person who provided the security can approach the Debt Recovery Tribunal for temporary relief. The other option is to pursue the matter in a court of law.

I closed a savings account with a public sector bank 15 months after opening it. The bank deducted Rs 100 towards account closure. Other public sector banks say there is no such charge.
According to the current market practice, most banks levy a charge on account closure. The amount and methodology vary across banks. Some banks charge according to the period the account was active: for instance, a charge of Rs 200 is levied per account if the closure is within one year of account opening and Rs 100 if the account is closed after one year. Others have a flat charge irrespective of the period the account was active. According to the Reserve Bank of India guidelines, all charges levied by a bank should be given in the bank’s schedule of charges and displayed on its website and in branches and shared with customers at the time of account opening. So, refer to your bank’s schedule of charges to check whether the charges were levied accordingly. If there is discrepancy, you can always approach the branch manager of your bank for a resolution.

I had invested in a one-year fixed deposit, a day before my bank cut its deposit rate on that maturity. Does that mean I will earn a lower rate than I was told?
According to the current practice, fixed deposits are booked at the interest rate prevailing as on the day/date clear funds are received by the bank. Hence, in this particular case, if clear funds were available with the bank before the rate cut, your fixed deposit will be booked at interest rates which were prevailing before the interest rate cut.

The writer is MD & head, private & business clients (India), Deutsche Bank. Views expressed are his own.
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