Return property papers within 30 days of loan repayment else pay ₹5000 a day

Published : 14 September 2023
Updated : 24 May 2024
Return property papers within 30 days of loan repayment else pay ₹5000 a day

In an important step, the Reserve Bank of India (RBI) has directed banks to release all movable/immovable property documents within 30 days of receiving full repayment and closure of a loan account. 

Why RBI has taken the action?

The RBI said it had noticed that some regulated entities were following ‘divergent’ practices in releasing property documents. This, in turn, leads to customer grievances and disputes, it added.

Compensation for delay

The RBI noted that the borrower must be allowed to collect the original papers either from the branch where the loan account was serviced or any other office of the RE where the papers were kept. It also held that the REs shall assist the borrower in obtaining duplicate copies of the originals, in case of loss or damage (partial/full), and also bear the assisted costs (in addition to the ₹5000 per day fine in case of delay. 

Who will Follow these guidelines? 

These guidelines are for all such documents that are due to be released on or after December 1. These must be followed by:

(1.) Commercial Banks (including Small Finance Banks and Regional Rural Banks; excluding Payments Banks)

(2.) Local Area Banks

(3.) Primary (Urban) Co-operative Banks.

(4.) State Co-operative Banks, District Central Co-operative Banks

(5.) Non-Banking Financial Companies (excluding Housing Finance Companies)

(6.) Asset Reconstruction Companies.


The step by RBI shall help many customers who are facing delays in the return of their property documents. Reserve Bank of India has initiated this step. So if you think that the law is violated for your account or loan then you have a right to take legal action against the lenders.