Lenders are intensifying loan recoveries. How should borrowers respond?

Do your best to avoid a default. But if it happens, and a collection agent comes knocking, remember you, too, have certain rights

Media reports suggest that banks and non-banking financial companies (NBFCs) are set to redouble their efforts in the coming months to ensure that retail loans don’t turn delinquent. Many have moved staff from other departments and asked them to join the collection drive. Pressed by demands from lenders, retail borrowers who are short of funds need to come up with a well-crafted response, instead of getting either intimidated or turning overly aggressive.

Bounce rates—which refer to the proportion of borrowers who don't pay their EMIs on time—of lenders have risen two-three times. A higher bounce rate, banks fear, could translate