Srinagar: Kashmir Traders Alliance has requested J&K Bank management to reverse their most recent decision regarding the imposition of “Commitment Charges” on the remaining balance of loans and credit lines granted to businesses.
In a statement released to the media to voice its disapproval, President of KTA, Aijaz Shahdhar, stated that this was the first time in the history of J&K Bank that borrowers were being forced to pay for loans or the percentage of loans that they actually didn’t take out or use. The bank has refrained from charging these fees perhaps in recognition of the hostile work environment earlier.
“The commitment charges have been deducted without prior intimation to the account holders as no such charges were deducted previously till the June quarter. If such charges were to be implemented by the bank, a proper intimation either by mail, sms, Or print media was to be sent to all the account holders,” reads the statement.
According to the RBI’s instructions, the financing banks were not required to levy commitment fees; rather, this was a voluntary decision that depended on the banks’ judgement, KTA stated.