If you are stuck in such a situation, here is what to do.

Mr. Rohan Sharma, a resident of Janakpuri, had taken a personal loan from “SwiftFin Services Pvt. Ltd.” His Equated Monthly Instalment (EMI) of approximately ₹12,000 was due on the 7th of the month. With about 18 months of tenure remaining, he experienced a slight delay in payment. A few days past the due date, his father, Mr. Dinesh Sharma, received a distressing phone call from an unknown number.

The caller, who identified himself as a recovery agent without naming the lending company, accurately quoted the outstanding amount. He proceeded to question Mr. Sharma Sr. about his relationship with Rohan and then issued a threat, claiming that a team would be arriving at their residence on the same day with a “court order” to recover the dues. Unfamiliar with the aggressive tactics of debt collectors, Mr. Sharma Sr. was deeply alarmed. Rohan, while accustomed to receiving reminder calls himself, was outraged that the agency had crossed a line by contacting his family and resorting to intimidation and false threats.

Advice in such cases

• Do not panic. These are often pressure tactics designed to scare you into immediate payment.
• Document everything. Note down the date, time, phone number of the caller, and the name they provide. If possible and legal in your jurisdiction, record the conversation.
• Verify the caller’s identity. Ask for their name, employee ID, the name of the agency they represent, and their authorization letter from the lending institution.
• Communicate directly with your lender (the bank or NBFC) in writing. Inform them about the harassment by their recovery agents.
• Never share sensitive personal or financial information like OTPs, PINs, or bank account details with unverified callers.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Applicable Sections of Law

The actions of such recovery agents violate RBI guidelines and may constitute criminal offenses under the Bharatiya Nyaya Sanhita, 2023 (BNS).

• Reserve Bank of India (RBI) Guidelines: The RBI has laid down strict guidelines for recovery agents. These include prohibitions against contacting borrowers at odd hours (before 8 AM and after 7 PM), using intimidation or harassment, and contacting third parties like family or friends to discuss the debt.
• Section 318 of the Bharatiya Nyaya Sanhita, 2023 (BNS): This section deals with criminal intimidation. Threatening a person or their family with injury to their person, property, or reputation can be prosecuted under this section.
• Section 320 of the BNS: This pertains to intentional insult with the intent to provoke a breach of the peace. The abusive language often used by agents can fall under this category.
• Section 323 of the BNS: This section prescribes the punishment for criminal intimidation, which can include imprisonment.

If you are the complainant

• Compile all evidence, including call logs, recordings, messages, and a written statement from the family member who was contacted.
• Lodge a formal written complaint with the grievance redressal officer of the concerned bank or NBFC, detailing the agent’s misconduct.
• If the lender does not take appropriate action, escalate the complaint to the RBI’s Banking Ombudsman scheme.
• File a police complaint or an FIR at your local police station under the relevant sections of the BNS for criminal intimidation and harassment.
• You can also file a complaint in a consumer forum for deficiency in service and unfair trade practices by the lending institution.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

If you are the victim

If you are a family member or friend who has been harassed by a recovery agent regarding someone else’s loan:

• Immediately inform the borrower about the call and the nature of the conversation.
• Write down all the details of the call for documentation purposes.
• You are not legally obligated to pay someone else’s debt. Do not get intimidated into making any payment.
• Your statement can serve as crucial witness testimony in any legal action taken by the borrower.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

How the police behave in such cases

Initially, the police might perceive the issue as a civil dispute related to loan recovery. It is important to clearly articulate the criminal aspect of the agent’s conduct—the threats, harassment, and intimidation. Presenting evidence like call recordings can be very effective. If the police are hesitant to file an FIR, you can approach a senior police officer or file a private complaint before a Magistrate under Section 175 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS).

FAQs people normally have

• Can recovery agents call my family about my loan?
  No. As per RBI guidelines, they cannot discuss the details of your loan with third parties. They may only contact them for the purpose of verifying your address after you have become untraceable.
• Can an agent threaten me with a “court order”?
  No. A recovery agent cannot issue a court order. This is a scare tactic. Only a court can issue summons or warrants after proper legal proceedings have been initiated.
• Is it legal for them to be so aggressive for a minor delay?
  No. Harassment and intimidation are illegal regardless of the amount or duration of the default. The recovery process must be civil and within the bounds of the law.

What evidence is required?

• Audio recordings of the threatening and harassing phone calls.
• Call logs and screenshots of the numbers from which the calls were made.
• Text messages, emails, or WhatsApp messages received from the agent.
• A written statement or affidavit from the family member who was harassed.
• Copies of complaints filed with the bank/NBFC and the RBI Ombudsman.

How long will the investigation take?

The timeline for resolution can vary. A complaint to the RBI Ombudsman is typically resolved within 30 to 90 days. A police investigation and subsequent criminal case can take much longer, depending on the complexity and the efficiency of the legal system. A consumer court case might also take several months to a couple of years to reach a final decision.

Advocate Sudhir Rao, Supreme Court of India