RBI sets fairer loan recovery rules from Jan 1, 2027
The Reserve Bank of India (RBI) just rolled out new rules to make loan recovery fairer and less invasive.
Starting January 1, 2027, banks and lenders can only call or visit borrowers about overdue loans between 8am and 7pm no more late-night stress.
Employees and recovery agents are now barred from using abusive language or social media to post video or audio recordings or personal details of the borrower or guarantor, and lenders must put in place mitigants, including penalty provisions, to prevent misuse of customer information.
RBI bars premature device feature limits
If you've taken a loan tied to a device like your phone or laptop, lenders can't limit its features unless you miss payments for 30 days (with proper notice).
Even then, access to incoming calls, SMS, and emergency SOS features must keep working, and outgoing calls shall not be restricted until the loan is 60 days past due.
If they wrongly block your device, they'll have to pay you ₹250 per hour (up to the total loan amount).
The bottom line: RBI wants borrowers treated with respect, no more harassment over missed payments.