A) PREAMBLE / INTRODUCTION
The Fair Practice Code (FPC) has been formulated by MUTHOOT MONEY LIMITED. (the Company) in response to guidelines issued by Reserve Bank of India vide circular DNBS.CC.PD. No.266 / 03.10.01 / 2011-12 dated 26 March 2012 titled “Guidelines on Fair Practices Code for NBFCs”.
The FPC will be applicable to all the offices of the Company including the Corporate Office, Hyderabad, Telangana, the Branch Offices located in various centres and the Branches located across India. The FPC shall be binding on all the employees and officers of the Company.
The objectives of the FPC are as under:
- Adopt the best practices in dealings with customers.
- Set challenging benchmarks and strive to achieve high operating standards for ensuring customer satisfaction.
- Follow transparent, fair, ethical and legally tenable practices while conducting business.
- Provide all necessary information and inputs to customers / prospective customers and promote a mutually beneficial long-term relationship.
- Facilitate a continuously growing base of satisfied customers while scrupulously avoiding acquisition of customers having doubtful credentials or criminal background.
C) DECLARATIONS & COMMITMENTS
- The Company undertakes to abide by all applicable laws, regulations and guidelines passed / issued by the Regulators (Reserve Bank of India, SEBI, etc.) and other competent authorities such as Government, Local Authority etc.
- The Company commits itself to full customer satisfaction through efficient, professional and courteous services across all its offices.
- The Company shall consistently strive to meet with and improve upon the internally set benchmarks and practices and be ahead of the standards prevalent in the industry.
- The Company undertakes not discriminate customers on grounds of religion, caste, gender or language.
- The Company will provide clear and full information about its products and services to its customers / prospective customers and will not resort to any misleading or potentially misguiding advertisement or publicity.
- The Company undertakes to desist from introducing any products / services having elements of ‘hidden charges’ or lack of transparency.
- The Company will communicate in the local language with the customer and in English at the request of the customer
- The Company undertakes not to take advantage of any unintentional or clerical error made by the customer while transacting business.
- The Company is committed to put in place a system for promptly addressing complaints and suggestions of the customers supplemented with a structured Grievance Redressal Mechanism having an escalation matrix.
- The Company shall display the FPC on its website and also make available to the Customer, on request, a copy of the FPC on demand.
D) FAIR PRACTICES
- LOANS, TERMS & CONDITIONS, INTEREST RATE & CHARGES
- The Company shall make available loan application forms in local language/English to all prospective customers free of cost at the concerned branches mentioning also the supporting documents to be submitted along with. An acknowledgement for receipt of duly completed loan application forms will be given to the customer in all cases. As a matter of policy and customer service loan applications are sanctioned / rejected immediately. Disbursement of the loan and acceptance of security will be carried out nearly simultaneously.
- The Company shall disclose all relevant information relating to a loan / product such as eligible loan amount, interest rate, charges, penal/overdue interest, interest calculation methodology, rebate on interest etc. before sanction of the loan to enable the customer / prospective customer to take an informed decision. The Customer / prospective customer will also be provided, on request, the detailed terms and conditions of the loan before sanction. A detailed charges/rates has been mentioned at the end in Charges/Rates section.
- The Company shall ensure that a loan Welcome letter and a set of signed agreement copy will be provided to the customer containing all the terms and conditions governing the loan facility in the local language or other language understood by the customer. The loan sanction letter will also mention the loan amount, loan account number, interest rate, charges, loan processing fees etc. The loan sanction letter which will bear the signature of the authorized official of the company.
- The Company shall not in the normal course make any changes / modifications in the terms and conditions of the loan, including rate of interest, which could adversely affect the customer financially or otherwise. In abnormal circumstances when such changes / modifications are inevitable, keeping in view the new circumstances, adequate and proper notice shall be given to the customer about any such change/modification.
(II) MARKETING & PROMOTION
- The Company shall not deliberately promote a product with any ulterior / selfish motives or contrary to the customer requirements or expectations as disclosed by the customer. The Company will ensure that its personnel engaged in marketing and operations are suitably trained and instructed so as to preclude selling of its products by misrepresentation to the customer / prospective customer.
- The Company will not indulge in profiteering by charging usurious rates of interest on loans or take undue advantage of adverse market conditions. The rates of interest will be based on variables such as cost of funds, risk premium, loan scheme, profit margin etc. and shall be in conformity with the Interest Rate policy of the Company and Regulatory Guidelines from time to time. It shall also, by and large, be in tune with industry practices and benchmarks.
- Full and updated information regarding loan schemes, rate of interest, charges etc. Complete or select information will also be made available through various media channels, posters, brochures, notices, displays etc. based on the decisions of the management of the Company from time to time.
(III) RECOVERY OF DUES, EXERCISE OF LIEN & DELIVERY OF SECURITY
- The Company will not, as a matter of fair dealing, normally recall the loan before the initially agreed tenure except in unanticipated or abnormal circumstances where the Company’s interests are adversely affected e.g. when the security value diminishes substantially, due to any regulatory / government directives etc. In all such cases proper and reasonable notice shall be given to the customer recalling the loan before expiry of the normal tenure.
- The Company will make all possible soft or persuasive efforts to get the customer to repay the dues without resorting to disposal of the security. The Company does not accept nor will it encourage the use any coercive or hard measures to recover its dues from the customer.
- The Company will deliver the security to the customer immediately upon settlement of the loan in the same condition as was at the time of sanction of the loan. In case of any damage caused to the security due to mishandling by its employees, the Company shall at its cost get the damage repaired or alternately pay reasonable compensation to the customer on a case to case basis. If the security has signs of damage thereon, before being taken custody of by the Company at the time of sanction of loan, the fact will be briefly incorporated in the sanction letter.
- The Company will exercise only legitimate right of lien over the pledged security or such cash surplus as may arise upon settlement of existing loans at any time. Such right of lien shall arise only if the customer has any other dues, either directly or as guarantor, and will be subject to proper intimation of such right of lien being given to the customer by the Company.
- The Company shall issue a signed and, normally, a system generated receipt for all cash payments made by the customer immediately. The Company shall also accept payments vide cheques, demand drafts, electronic transfers etc. subject to the condition that return of the security will be made only after confirmation of realization.
- Even though the loan sanction letter contains all applicable terms and conditions of the loan the Company shall, nevertheless, endeavour, on a best effort basis, to send advices, reminders etc. regarding due date for payment of interest, principal etc. by letter, courier service, telephone, SMS etc.
- The Company will resort to disposal of security only as a last resort and that too after adequate and proper notice is served on the customer to repay the dues. Such notice will be as per the terms contained in the sanction letter and also in compliance with applicable laws and regulatory guidelines. The disposal of the security will be taken up through public auction/any suitable medium of selling of the security when the customer does not positively respond to the communications sent by the Company to close the loan account along with interest and other charges.
- The Company shall, on demand, provide the customer or his duly authorized representative with a statement of the loan account at any time during the currency of the loan or immediately upon closure. However, the Company may, at its discretion, require payment of reasonable processing charges by the customer for providing statement of account if such demand is made 30 calendar days after closure of the account.
- The Company shall, on demand, provide the customer or borrower’s/ duly authorized representative with a statement of the loan account at free of the cost during the tenure of the loan or immediately upon closure. For the second copy of SOA an amount of Rs. 250 + Taxes will be charged.
- Where the Company proposes to dispose of the security even before the normal tenure of the loan based on the rights conferred on the Company vide loan application and loan sanction letter adequate and proper notice will be served on the customer before such action is initiated for recovery of dues.
- The Company prefers and encourages customers to take back delivery of the security immediately upon full settlement of all dues. However, should there be exceptional instance of the Customer being unable to take delivery of the security, not attributable to the inability of the Company, after closure of the loan account reasonable safe custody charges may be payable which will be duly advised to the customer.
- The Company will not interfere in the affairs of the customers except for the purposes mentioned in the terms & conditions of the loan or when constrained to do so due to inadequate or false disclosures made by the borrower at the time of putting through the transactions.
(IV) CUSTOMER SERVICE & GRIEVANCE REDRESSAL
- The Company will implement all possible steps to prevent and minimize customer complaints / grievances
- The Company will put in place an effective Customer Grievance Redressal mechanism details of which will be displayed on the website and in all the branches. The mechanism will specify interalia the names & designations of the officials with whom complaints can be registered, their postal address / telephone numbers/ email address, escalation matrix, time limit for acknowledging receipt of complaint, time limit for dealing with the complaint etc. It will also put in place at all offices where business is transacted, the complete contact details of the Regional Office of RBI, Cochin, within whose jurisdiction the registered office of the company is situated, so that the customers may directly approach the RBI in case their grievances are not redressed within one month of the receipt of complaints by the company”
- The Company will put in place an effective training system to ensure that employees of the Company are customer friendly and do not resort to rude, inappropriate or unethical behaviour.
- The Company will endeavour to work out and display the time norms for putting through and completing the various transactions.
- The Company will have a sympathetic approach to the problems faced by the customer especially the poor and underprivileged sections.
(V) REPOSSESSION OF SECURITY
- The Company reserves the right to enforce security for recovery of dues on the terms and conditions stipulated in the loan agreement in case of default in payment or on the occurrence of any other event of default. During recovery of loans, the Company will not resort to undue harassment like bothering the borrowers at odd hours or use of force for recovery of loans.
- The Company would refrain from intervening in the affairs of the borrowers except as provided in the terms and conditions mentioned in the loan agreement, unless new information, not disclosed by the borrower, has come to the notice of the Company.
- The Company would not discriminate on grounds of sex, caste and religion in the matter of lending.
- In case of receipt of request for transfer of borrower account, either from the borrower or from a bank/non-banking finance company, which proposes to take over the account, the consent or otherwise i.e. objection of the Company, if any, would be conveyed within 21 days from the date of receipt of request.
- Repossession of security is aimed at recovery of dues and not to deprive the borrower of the security. The recovery process through repossession of security will involve repossession, valuation of security and realization of security, through appropriate means. All these would be carried out in a fair and transparent manner. Repossession will be done only after issuing proper notices. Due process of law will be followed while taking repossession of the security. The Company will take all reasonable care for ensuring the safety and security of the collateral after taking custody, in the ordinary course of the business
- An appropriate grievance redressal mechanism would be put in place whereby disputes arising out of the decisions of Company’s functionaries would be heard and disposed off.
- The Company shall display the normal business hours at the respective branches, the list of holidays and notify the changes, if any, by way of a notice displayed in the premises of the branch.
- Personal information of the customer will not be shared with unauthorized persons or agencies or third parties by the Company. However, the Company will be bound to honour and comply with legal or regulatory requirements, if any, in this matter obligating it to part with such information even without notice to the customer.
- Penal charge of 3% per month will be levied on overdue instalment.
- Rupees 1000/- (all inclusive) will be charged for every cheque bounce.
CODE OF CONDUCT FOR DIRECTORS & SENIOR MANAGEMENT OF MUTHOOT MONEY LIMITED.
The Code of Conduct for Directors & Senior Management of Muthoot Money Limited (“theCode”) helps to the standards of business conduct of Muthoot Money Limited (“the Company”) and ensures compliance with various legal requirements which governs the operations of the Company. The purpose of code is to promote ethical conduct and to deter wrongdoing so as to protect the best interest of the company and its stakeholders. The matters covered in the Code are of utmost importance to the Company, our shareholders and our business associates and partners. Further, these are essential so that we can conduct our business in accordance with stated values.
The members of the Board of Directors of the Company and other Senior Management Officials acknowledge and accept the scope and extent of their duties as Directors and Senior Management Officials of the Company (“the Officers”). They have a responsibility to carry out their duties in an honest and businesslike manner and within the scope of their authority, as set forth in the laws of India as well as in the Memorandum and Articles of Association of the Company. They are entrusted with and are responsible for the oversight of the assets and business affairs of the Company in an honest, fair, diligent and ethical manner. As the Officers of the Company, they must act within the bounds of the authority conferred upon them and with the duty to make and enact informed decisions and policies in the best interests of the Company. The Board of Directors has adopted the following Code of Conduct and the Directors and senior managers are expected to adhere to the standards of care, loyalty, good faith and the avoidance of conflicts of interest that follow.
The Code of Conduct
Board Members and Senior Managers will:
- Act in the best interests of, and fulfill their fiduciary obligations to the Company;
- Act honestly, fairly, ethically and with integrity;
- Conduct themselves in a professional, courteous and respectful manner and not take improper advantage of their position;
- Will deal fairly with all stakeholders;
- Comply with all applicable laws, rules and regulations;
- Act in good faith, responsibly, with due care, competence and diligence, without allowing their independent judgment to be subordinated;
- Not use the Company’s property or position for personal gain;
- Not use any information or opportunity received by them in their capacity as Directors or senior management in a manner that would be detrimental to the Company’s interests;
- Act in a manner to enhance and maintain the reputation of the Company;
- Disclose any personal interest that they may have regarding any matters that may come before the Board and abstain from discussion, voting or otherwise influencing a decision on any matter in which the concerned Director has or may have such an interest;
- Abstain from discussion, voting or otherwise influencing a decision on any matters that may come before the board in which they may have a conflict or potential conflict of interest;
- Not to serve as a Director or otherwise be in employment or engage in providing services to a Company that competes with the Company.
- Respect the confidentiality of information relating to the affairs of the Company acquired in the course of their service as Directors or senior management, except when authorized or legally required to disclose such information;
- Not use confidential information acquired in the course of their service as Directors or senior management for their personal advantage or for the advantage of any other entity;
- Help create and maintain a culture of high ethical standards and commitment to Compliance; Adopted by the Board of Directors of Muthoot Money Limited at their meeting held on July 23, 2010
VIGIL MECHANISM / WHISTLE BLOWER POLICY
As an employee friendly organization, Muthoot Money Pvt Ltd believes in the conduct of the affairs of its constituents in a fair and transparent manner, by adopting the highest standards of professionalism, honesty, integrity and ethical behavior. We are committed to conducting business with integrity and in accordance with all applicable laws and regulations.In its endeavor to provide its employee a secure and a fearless working environment, MMPL has established the "Whistle Blower Policy” (‘‘the policy’’)
A whistle-blowing or reporting mechanism as such set out in the Policy, invites all employees to act responsibly to uphold the reputation of the Company and its subsidiaries. The Policy aims to ensure that serious concerns are properly raised and addressed and are recognized as an enabling factor in administering good governance practices.
The definitions of some of the key terms used in this Policy are given below. Capitalized terms not defined herein shall have the meaning assigned to them under the Code.
- "Audit Committee" means the Audit Committee constituted by the Board of Directors of the Company in accordance with Companies Act,2013.
- "Whistle Blower Committee" means the Committee constituted to deal with complaints under this Policy.
- "Employee" means every employee of the Company(permanent & contractual employees whether working in India or abroad), including the Directors in the employment of the Company.
- "Code" means the Code of Conduct of the company.
- "Investigators" or “the Investigator” mean those person(s) authorized, appointed, consulted or approached by the Whistle Blower Committee and includes the auditors of the Company and thepolice.
- "Protected Disclosure" means any communication made in good faith that discloses or demonstrates information that may evidence unethical or improper activity.
- “MMPL” or “the company” means Muthoot Money Pvt Ltd.
- "Subject" means a person against or in relation to whom a Protected Disclosure has been made or evidence gathered during the course of an investigation.
- "Whistle Blower" means an Employee making a Protected Disclosure under this Policy.
- The Whistle Blower’s role is that of a reporting party with reliable information. They are not required or expected to act as investigators or finders of facts, nor would they determine the appropriate corrective or remedial action that may be warranted in a givencase.
- Whistle Blowers should not act on their own in conducting any investigative activities, nor do they have a right to participate in any investigative activities other than as requested by the Investigator or the Whistle Blower Committee or the Investigators.
- Protected Disclosure will be appropriately dealt with by the Whistle Blower Committee.
The policy should be applicable to;
- The Directors of the company
- All permanent & contractual employees of the company based in India or outside
- Employees of other agencies deployed for the Company
- Contractors, vendors, suppliers or agencies (or any of their employees)
- Customers of the Company
- Any other person having direct association with the Company
- While it will be ensured that genuine Whistle Blowers are accorded complete protection from any kind of unfair treatment as here in set out, any abuse of this protection will warrant disciplinary action.
- Protection under this Policy would not mean protection from disciplinary action arising out of false or bogus allegations made by a Whistle Blower knowing it to be false or bogus or with a mala fide intention.
- Whistle Blowers, who make three or more Protected Disclosures, which have been subsequently found to be malafide, frivolous, baseless, malicious, or reported otherwise than in good faith, will be disqualified from reporting further Protected Disclosures under this Policy. In respect of such Whistle Blowers, the Company/Whistle Blower Committee would reserve its right to take/recommend appropriate disciplinary action.
7) WHISTLE BLOWER COMMITTEE
The Whistle Blower Committee comprises of following personnel:
- The Chairman- Board of Audit Committee (Chairman of WBC Committee)
- Chief Operating Officer
- Head- Human Resources
- Head- Risk Management
- Head- Legal & Compliance
- Head- Internal Audit
- The Committee with a minimum of 2/3 quorum to meet 24 hours from the date of receipt of a complaint under the Policy. Such meetings shall be conducted within normal working hours only.
- Protected Disclosures should preferably be reported in writing so as to ensure a clear understanding of the issues raised and should either be typed or written in a legible hand writing in English or in the regional language of the place of employment of the Whistle Blower.
- All Protected Disclosures may be addressed to anyone of the following offices;
Board of Audit Committee
Muthoot Money Pvt.Ltd,
Muthoot Chambers, Kurians Tower
Banerji Road, Ernakulam,
Kerala – 682 018
The Chief Operating Officer
Muthoot Money Pvt Ltd,
#3-6-2/1/3, 3rd Floor,
Grandpa’s Royal Mansion, Liberty X Road,
Himayath Nagar, Hyderabad,
Telangana - 500 029
Internal Audit Department
Muthoot Money Pvt Ltd,
#3-6-2/1/3, 3rd Floor,
Grandpa’s Royal Mansion,
Liberty X Road, Himayath Nagar,
Hyderabad, Telangana-500 029
Employees may also write to email@example.com
- The Protected Disclosure should be forwarded under a covering letter. The Chairman of the WBC Committee shall detach the covering letter and discuss the Protected Disclosure with Members of the WBC Committee and if deemed fit, forward the Protected Disclosure to the Investigator of the Company for investigation.
- Protected Disclosures should be factual and not speculative or in the nature of a conclusion, and should contain as much specific information as possible to allow for proper assessment of the natureand extent of the concern and the urgency of a preliminary investigative procedure.
- The Whistle Blower need not disclose his/her identity while making Protected Disclosure.
- All Protected Disclosures reported under this Policy will be thoroughly investigated by the Investigator of the Company who will investigate / oversee the investigations under the authorisation of the WBC Committee.
- Protected Disclosures involving or relating to the Investigator which in the opinion of the WBC Committee may hamper the independence of the Investigator in conducting the investigation will be investigated by the WBC Committee itself.
- The Investigator / WBC Committee may at its discretion, consider involving any Investigators for the purpose of investigation.
- The decision to conduct an investigation taken by the WBC Committee is by it self not an accusation and is to be treated as aneutral fact - finding process. The outcome of the investigation may not support the conclusion of the Whistle Blower that an improper or unethical act was committed.
- The identity of a Subject will be kept confidential to the extent possible given the legitimate needs of law and the investigation.
- Subjects will normally be informed of the allegations at the outset of a formal investigation and have opportunities for providing their inputs during the investigation.
- Subjects shall have a duty to co-operate with the Investigator / WBC Committee or any of the Investigators during investigation to the extent that such co-operation sought does not merely require them to admit guilt.
- Subjects have a right to consult with a person or persons of their choice, other than the Investigator/ Investigators and /or members of the WBC Committee and/or the Whistle Blower. Subjects shall be free at any time to engage counsel at their own cost to represent them in the investigation proceedings.
- Subjects have a responsibility not to interfere with the investigation. Evidence shall not be with held, destroyed or tampered with, and witnesses shall not be influenced, coached, threatened or intimidated by the Subjects.
- Unless there are compelling reasons not to do so, Subjects will be given the opportunity to respond to material findings contained in an investigation report. No allegation of wrong doing against a Subject shall be considered as maintainable unless there is good evidence in support of the allegation.
- Subjects have a right to be informed of the outcome of the investigation. If allegations are not sustained, the Subject should be consulted as to whether public disclosure of the investigation results would be in the best interest of the Subject and the Company.
- The investigation shall be completed normally within 45 days of the receipt of the Protected Disclosure.
- No unfair treatment will be meted out to a Whistle Blower by virtue of his/her having reported a Protected Disclosure under this Policy. The Company, as a policy, condemns any kind of discrimination, harassment, victimization or any other unfair employment practice being adopted against Whistle Blowers. Complete protection will, therefore, be given to Whistle Blowers against any unfair practice like retaliation, threat or intimidation of termination/suspension of service, disciplinary action, transfer, demotion, refusal of promotion, or the like including any direct or indirect use of authority to obstruct the Whistle Blowers right to continue to perform his duties/functions including making further Protected Disclosure. The Company will take steps to minimize difficulties, which the Whistle Blower may experience as a result of making the Protected Dscisure. Thus, if the Whistle Blower is required to give evidence in criminal or disciplinary proceedings, the Company will arrange for the Whistle Blower to receive advice about the procedure,etc.
- The identity of the Whistle Blower shall be kept confidential to the extent possible and permitted under law. Whistle Blowers are cautioned that their identity may become known for reasons outside the control of the Investigator / WBC Committee (e.g. during investigations carried out by Investigators).
- Any other Employee assisting in the said investigation shall also be protected to the same extent as the Whistle Blower.
- Investigators are required to conduct a process towards fact-finding and analysis. Investigators shall derive their authority and access rights from the WBC Committee when acting within the course and scope of their investigation.
- Technical and other resources may be drawn upon as necessary to augment the investigation. All Investigators shall be independent and unbiased both in fact and as perceived. Investigators have a duty of fairness, objectivity, thoroughness, ethical behavior, and observance of legal and professional standards.
- Investigations will be launched only after a preliminary review which establishes that:
- The alleged act constitutes an improper or unethical activity or conduct, and
- either the allegation is supported by information specific enough to be investigated, or matters that do not meet this standard may be worthy of management review, but investigation itself should not be undertaken as an investigation of an improper or unethical activity.
If an investigation leads the WBC Committee to conclude that an improper or unethical act has been committed, the WBC Committee shall direct the management of the Company to take such disciplinary or corrective action as the WBC Committee deems fit. It is clarified that any disciplinary or corrective action initiated against the Subject as a result of the findings of an investigation pursuant to this Policy shall adhere to the applicable personnel or staff conduct and disciplinary procedures.
- The Investigator shall submit a report to the WBC Committee on a regular basis about all Protected Disclosures referred to him/her since the last report together with the results of investigations,if any.
- A quarterly report about the functioning of the Whistle Blower Mechanism shall be placed before the board of Audit Committee. Status report on the total number of compliant received if any during the period with summary of the findings of the investigator and corrective steps taken should be send to the Board of Directors of the Company.
14) RETENTION OF DOCUMENTS
All Protected Disclosures in writing or documented along with the results of investigation relating thereto shall be retained by the Company for a minimum period of seven years.
15) POLICY NOTIFICATIONS
All employees shall be notified of the existence and contents of the Whistle Blower Policy by Human Resource Department and all other stakeholders including business partners and vendors by the respective HOD who interacts with the stakeholders in relation to the operation of the Company.
For significant disclosures, Management at their sole discretion may offer ‘Rewards to the Whistle Blower’ in the form of monetary awards and or Career path advancement, based on skills and capability.
The Company reserves its right to amend or modify this Policy in whole or in part, at any time without assigning any reason whatsoever. However, no such amendment or modification will be binding on the employees and directors unless the same is notified to the Employees in writing.