The Reserve Bank of India (RBI) has issued new guidelines regulating the remote locking of devices, such as mobile phones, laptops, and tablets, and the loan recovery process. Under the new rules, banks and finance companies cannot immediately lock a device if a borrower misses an EMI payment.

If you have purchased a mobile phone or any other gadget on loan and are not paying EMIs for any reason, your device won't be immediately locked. If EMIs are overdue for more than 30 days, the customer will receive a notice, and certain restrictions will be imposed. Following this, if your EMIs are overdue for more than 60 days, banks or finance companies can completely lock the device.

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What Are The Conditions Applied?

As per the RBI guidelines, the aforementioned rules apply only to cases where the loan was specifically taken to purchase a device. If you have a personal loan, consumer loan, or other loan that isn't directly related to the purchase of a smartphone, tablet, or laptop, that device cannot be locked for loan recovery.

Which Features Will Remain Enabled?

Certain essential features of the device will remain enabled even after a remote ban is imposed. Essential functions related to emergency communication, such as incoming calls, SMS, and SOS, will not be disabled during the ban. Essential features related to work and employment will also not be disabled.

The new RBI frameworks mentioned that the bank agents cannot access the contact list, photos, videos, messages, call logs, location history, or any other personal information of the customers, even after the non-payment of the EMI.

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Guidelines For Banks

Under the RBI's new rulebook, banks will also be required to develop a detailed recovery policy. Banks must conduct thorough and proper due diligence before engaging any recovery agency. Recovery agents can only contact customers between 8:00 am and 7:00 pm. Banks will be required to record all calls made by recovery agents and preserve these records for at least six months.