Loan Charges

A Schedule of Penal Charges for Non-Compliance of Loan Repayment

Effective from April 1, 2024, as per RBI Guidelines and Bank Policy.

1. Overview of Penal Charges

In compliance with Reserve Bank of India directives, SUCO Bank has replaced "Penal Interest" with Penal Charges. Unlike interest, these charges are:

• Not Capitalized: No further interest is calculated on the penal charge amount.
• Fixed & Transparent: Based on the type of default rather than a percentage added to your interest rate.

2. Charges for Default in Loan Repayment

If a loan instalment or interest (full or partial) remains unpaid after the due date, it is treated as an amount in default.

• Rate: ₹3 per thousand per month on the default amount.
• Rounding: The due amount is rounded to the nearest ₹1,000 for calculation.
• Calculation Logic: A default for even one day is treated as a default for the entire month. Charges are computed progressively every month until the overdue amount is cleared.

3. Charges for Non-Compliance with Material Terms

"Material Terms" are conditions agreed upon during loan sanction. Failure to provide required documentation or meet these conditions will attract a one-time penal charge based on your loan limit.

Common Examples of Non-Compliance:

• Non-submission of Financial Statements, Stock Statements, or Project Progress Reports.
• Failure to submit RTO Registration Certificates (with Bank's lien) or duplicate keys for vehicle loans.
• Non-submission of yearly Encumbrance Certificates or Tax Paid Receipts.

• GST: All penal charges attract applicable Goods and Services Tax (GST).
• Recovery Sequence: When you make a payment, the bank will first recover any outstanding Penal Charges before adjusting the amount toward your interest or principal.