The Reserve Bank of India (RBI) on Thursday chided banks for publishing photos of defaulters and guarantors in newspapers even as they may or may not be categorised as “wilful defaulters” going by RBI methodology. RBI, in a notification on its website, said there was “sensitivity involved” in publishing such photographs there was a need to “prevent the publishing of photographs of defaulting borrower/guarantor in an indiscriminate manner.”
A lending institution can consider publication of the photographs of only those borrowers, “including proprietors/partners/directors/guarantors of borrower firms/ companies, who have been declared as wilful defaulters, following the mechanism set out in the RBI instructions referred to above,” RBI said, adding the mechanism does not apply to the non-whole time directors who are exempted from being considered as wilful defaulters unless under special conditions.
Banks should therefore formulate a policy that clearly sets out the criteria based on which the decision to publish the photograph of a person is taken “so that the approach is neither discriminatory nor inconsistent,” the central bank said in its statement.
