Home Loan from State bank of India
Arbitrary EMI Recovery on SBI Home Loan

Subject: Arbitrary EMI Recovery on SBI Home Loan

Reference Loan Account No 00000030723834238

in favour of Lt Col (Retd) Arun Kumar Chandel, SM

Dear Sir,

1. It is to bring to your kind information that I have obtained a SBI Housing loan of Rs 35, 00, 000/ (Thirty five lakhs only) vide Arrangement letter- SBI Home Loan dated 26.03.2009 (Loan account No 00000030723834238). My home Branch is SBI Jawahar Vyapar Bhawan, New Delhi.

2. At the time of loan sanction, the EMI for the first year was fixed at 8% i.e. 36001/ and it was expected to be revised from May in accordance to the prevailing State Bank Advance Rate under the clause as specified in para 4 (b) of the arrangement letter. However, the revised EMI by SBI has been enhanced arbitrarily to Rs 41, 154/ w.e.f May and the recovery of the same has commenced w.e.f 20th May. (Statement of linked SBI SB account No 00000030723545882 attached as annexure 1)

3. The matter was brought to the notice of Shri Sagar Sharma, Branch Head of my Home Branch at Jawahar Vyapar Bhawan New Delhi. While the matter was under discussion, SBI RACPC deducted second EMI in the same month on 27th May (refer attached loan account statement as annexure 2). Aggrieved with the financial situation, I visited RACPC on 7th Jun 10 and inquired about the incorrect EMI calculation and also double deduction of EMI in the same the month. Inspite of having spent half a day in the bank, I was not provided with any reasonable response to my complaint and was told by the dealing officer “not to expect anything favourable from Bank as they have no time to attend to complaints”.

4. Having failed to get any response from RACPC, I had approached Mr Sagar Sharma and he advised me to e-mail the issue of incorrect EMI for taking the up matter with RACPC. Accordingly, a complaint was sent to the Branch Manager on 09 Jun followed by another on 30 Jun. Copies of my complaints are attached as annexure 3.

5. I have pursued my case with Shri Sagar Sharma continuously for a period of 08 weeks; however, neither have I got any relief in the matter nor was any justification given for exceptionally high interest rate on my home loan.

Finally in response to my SMS dated 30 Jul on his mobile No 919818780279, I received a reply from Shri Sagar Sharma, Branch Manager SBI which is reproduced for your information please.

“Sir,

As discussed before i had forwarded the case to RACPC, New Delhi, headed by AGM. Whatever follow up that had to be done

from my end i hve done, rest is not under my control. I am sorry

for the inconvenience caused but discussing the same thing again & again with me can bear no fruit.

Regards

Sagar

6. It is obvious that the new EMI (Rs 41, 154/) is calculated contrary to the latest guidelines issued by the Reserve Bank India vide its circular number RBI-1-/390 dated 09.04.2010 under reference DBOD No. Dir. BC 88/13.03.00-10 addressed to all Schedule Banks on the guideline on abolishing BPLR system and implementing Base Rates for the calculation of Interest on loans. Under the para xi of the ibid RBI Circular on Transitional issues, I am eligible for the revised EMI calculated against the base rates.

7. I am a retired Army Officer and have done recognizable service to the Nation. I am a Gallantry Award Winner and have risked my life several times for the safety & security of the people of this country. I am deeply hurt to witness this thankless attitude of SBI RACPC New Delhi and strongly condemn their conduct. It is astounding to see that in a country which is having growth rate of 8.5%, there are such incompetent and insensitive bank officials paid out of public money.

8. I consider this arbitrary increase of rate of interest on loan as an unfair practice adopted by the State Bank India in the shadow of non transparency. It is therefore, I have lost faith in the systems which have been adopted by the State Bank of India for Indian customers and would strongly consider moving out my balance liability of home loan for takeover by any other better Nationalised Bank.

9. In view of the aforesaid, it is requested that the case may please be inquired to bring out the details of unfair play in fixing new EMI on my home loan. It is also requested that the case may kindly be redressed within 10 day of the receipt of this letter positively by 14th of Aug failing which I would be constrained to seek legal intervention from The Reserve Bank of India.

Thanking you in anticipation.

Yours truly

A K Chandel