OPERATIONAL GUIDELINES

■ Sourcing of Applications:

i) Simplified Application Form will be available from all Designated Branches in the city / town where Municipality maintains account of BSUP / IHSDP Fund

ii) The completed application form along with required documents in duplicate duly filled in and signed by eligible beneficiary would be deposited with concerned financing branch

iii) At the time of receiving application form and other relevant papers,

branch should arrange for a preliminary interview with applicant and scrutinize all papers produced by the applicant.

■ Vetting of application by concerned Municipality

i) The financing branch immediately will send one set of application to the

concerned Municipality by a forwarding letter for verification and

necessary action at their end

ii) Recommendation in Certificate Form : The Competent Authority of concerned Municipality will verify the bonafide status of the applicant and recommends for sanction of loan, issuing a certificate. On completion of above formalities, vetted application form will come back to the originating Designated Branch.

■ Processing of application

The financing branch should complete the pre-sanction inspection of property and permanent residence of applicant. At the time of inspection, Branch official should verify that slum cluster is close to major road network of the town and major public transport facilities are also available.

■ Sanction

After receiving vetted application form from competent authority of concerned Municipality & verifying the authenticity of vetting, the branch will process the loan and sanction the loan by issuing sanction letter to the beneficiary (A copy will be sent to the Municipal Authority).

■ Documentation

After being accepted the sanction letter by the beneficiary, the selected branch will arrange for documentation, creation of mortgage & cross guarantee and initiative should be undertaken to make it hassle free as far as possible.

■ Disbursement of loan

i) For Construction / Upgradation of house by borrower: Disbursement

will be made in one stroke by crediting SB a/c of the applicant and completion certificate shall be submitted to the branch within 6 months from the date of disbursement

ii) For construction/ Upgradation of house by Other Agency: Disbursement will be made by issuing DD/PO in the name of agency directly after netting advance amount paid, if any and branch should

ensure that the proceed goes to the agency

iii) On the day of disbursement of loan, both borrower and property

should be covered by life insurance (SBI Life / TATA AIG) and property insurance (Bajaj Allianz Co.) respectively and one time premium may be collected by debiting the loan account or as the case may be as per terms of sanction of loan.

■ Recovery of Loan

i) Information to concerned Municipality

Immediately after disbursement of loan, the Designated Branch should

intimate concerned office of Municipality about terms and conditions of loan to beneficiary and liability of Municipality for recovery in case of default in repayment of EMI by the borrower.

ii) Repayment of EMI

Borrower-beneficiary will start repayment of EMI one month after completion of construction or after 12 months from date of is disbursement whichever is earlier and Bank will exercise its usual follow-up & recovery measures. Despite Bank's normal recovery efforts, if borrower defaults to repay EMI of loan regularly. Municipality in coordination with the branch will undertake and enforce all necessary administrative measures for regularization of Loan a/c. In this regard, an undertaking and consent letter will be obtained from the Municipal Authority.

iii) Early Recall of Loan

In case borrower commits breach of any terms and conditions laid down in the sanction of loan, entire amount of loan with interest shall become payable in lump sum and shall be recoverable under the provisions of the Public Demand Recovery Act in coordination with Municipal Authority.

iv) Reschedule of EMI

Due to happening of unavoidable circumstances viz., long illness or

accident or any other reasons beyond his/her control, the branch in consultation with concerned office of Municipality, may reschedule payment of usual EMI or overdue EMI.

v) Liquidation of loan

After full repayment of loan, financing branch will issue complete

recovery certificate intimating the concerned office of Municipality and discharge all required papers to the borrower