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Loans & EMI

Loan Interest Rate Changed Without 30-Day Prior Notice

Your bank or NBFC has changed the interest rate on your loan — increasing your EMI or tenure — without giving you at least 30 days prior written notice as required by RBI.

Applies to: All banks and NBFCsRBI Fair Practices Code — Loan Agreement requirements

⚖️Your Rights Under RBI Regulations

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Lenders must give 30 days written notice before any change in interest rate or charges.

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You have the right to close the loan account without penalty during the notice period if you disagree with the change.

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Interest charged from the date of change without notice is not lawfully accrued — you can dispute the differential.

💰 What You Can Recover

Refund of excess interest charged between date of rate change and date proper notice should have been given.

⏱ Response Deadline

30 days for response to written complaint.

📋Step-by-Step — What to Do

1

Document the old rate, new rate, and date of change from your statements.

2

Write to the lender asking for proof of notice — if they cannot produce it, the change was not properly communicated.

3

Demand refund of excess interest charged during the notice gap period.

4

Escalate to Nodal Officer then RBI Ombudsman if unresolved.

🏛 Where to Escalate If Bank Doesn't Respond

RBI Integrated Ombudsman — cms.rbi.org.in

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Governing RBI Circular
RBI Fair Practices Code — Loan Agreement requirements
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