Can I seek relief from bank's unfair practice & high-handedness?
It was during December 2004 that I availed a Loan against Rent Receivables from Punjab National Bank, T Nagar branch Chennai. The loan amount sanctioned was Rs. 32 lakhs; Rate of Interest was BPLR+0% which was 10.75%; Tenure of Repayment was 120 months after disbursement. The tenant was Bank of Maharashtra whose rent was being securitized for this loan. The collateral security offered was the land & building at T Nagar valued at Rs. 5 crores (approx.).
The interest rate is linked to BPLR (Prime Lending Rate) and hence is a Floating rate. Even as the loan tenure neared its end (120 months) still there was a principle amount of Rs. 15 lakhs outstanding in the loan account. This was nearly 50% of the original loan amount which makes the situation alarming. The reason is that the interest rate has been increased several times by PNB.
After analyzing the details of the account and raising the concern with PNB during April 2015, they reduced the interest rate from 15% to 11.25% with effect from April 2014, citing internal rating and collateral security as the reasons. It may be noted that throughout the loan tenure the account has been regularly conducted, repayments made, the tenant, the collateral security offered remains the same and no adverse change in the credit standing of the borrower.
During the period 2007 to 2014 PNB had irrationally raised the interest rate on several instances over the BPLR+5% and even more. During the oral discussions with PNB they refused to accept any request to reverse the interest charged during that period.
Kindly suggest a relief for this issue.