No bank has the power to appoint musclemen for recovery of loans, and recovery agents have to be appointed according to the prescribed norms, Minister of State for Finance Anurag Thakur said on Monday.
Replying to queries of members in the Lok Sabha during the Question Hour, Thakur said there is a process of police verification in the appointment of recovery agents and they have to clear a module prepared by the Indian Institute of Banking and Finance.
He said the circular issued by the Reserve Bank of India advises banks to ensure that their contracts with recovery agents do not induce "adoption of uncivilised, unlawful and questionable behaviour in the recovery process".
"No one has a right to appoint musclemen," he said.
Thakur was asked if bouncers can be deployed by banks for recovery of loans, to which he said the recovery process proceeds after giving due notice.
The minister said that of the nearly 250 complaints about non-observance of RBI guidelines in 2018-19, 31 have been settled and 58 rejected.
He said ombudsmen have been appointed by the states to look at grievances including those against the banks .
Disclaimer: No Business Standard Journalist was involved in creation of this content
