Untitled Document

Policy On Fair Practices Code


Ujjivan Financial Services Pvt Ltd (hereinafter referred as "Ujjivan" or "Company") seeks to enable economically active poor to build a better life and promote financial inclusion by providing full range of financial services. In pursuing its mission, Ujjivan has been ensuring principles of "responsible lending, transparency and ethical values" are followed in all its dealings with customers, since its inception. Ujjivan follows various guidelines issued by Reserve Bank of India (RBI) on Fair Practices Code for NBFC-MFIs and has also adopted Industry Code of Conduct developed by MFIN (Microfinance Institutions Network) and Sa-Dhan (The Association of Community Development Finance Institutions). Ujjivan also endorsed "Smart Campaign"; a global initiative committed to embedding strong client-protection practices into the microfinance industry, and implemented adequate global standards of Client Protection Principles.

Since the Organization has expanded its operations to more number of states & regions across India and number of staff are increasing proportionately, it is considered appropriate to enhance the scope of existing Board approved policy for better understanding of the Fair Practices Code and effective implementation of the policy guidelines.


  • Develop a comprehensive Fair Practices Code to adopt guidelines provided by regulator, self regulatory organizations and global standards of client protection principles.
  • Formulate operating guidelines for implementation of Fair Practices Code in an effective manner.
  • Disseminate the policy guidelines in an effective manner to all stake holders in general and to customers & employees of Ujjivan in particular.
  • Review & reinforcement mechanism to ensure high level of adherence to Fair Practices Code.
  • Mechanism for constantly receiving feedback/grievances from customers in order to improve the implementation of Fair Practices Code.



    Core Values:

    • To provide low-income clients and their families, with access to financial services that are client focused and designed to enhance their well-being, and are delivered in a manner that is ethical, dignified, transparent, equitable and cost effective.

    Core Values:

    • To ensure quality services to clients, appropriate to their needs, and delivered efficiently in a convenient and timely manner.
    • To maintain high standards of professionalism based on honesty, non-discrimination and customer centricity.

    Core Values:

    • To provide complete and accurate information to clients regarding all products and services offered.
    • To create awareness and enable clients and all other stakeholders to understand the information provided with respect to financial services offered and availed.

    Operating Guidelines:

    1. Applications for loans and their processing
      1. All communications to the borrower shall be in the vernacular language or a language as understood by the borrower.
      2. Loan application forms should include necessary information which affects the interest of the borrower, so that a meaningful comparison with the terms and conditions offered by other lenders can be made and informed decision can be taken by the borrower. The loan application form should indicate the documents required to be submitted with the application form.
      3. Shall provide acknowledgement for receipt of all loan applications. Preferably, the time frame within which loan applications will be disposed of should also be indicated in the acknowledgement.
    2. Loan appraisal and terms/conditions
      1. Field staff shall explain all the features, benefits, terms/conditions and pricing of our services including all fees, charges and interest rate on an annual declining basis, during Compulsory Group Training (CGT) and loan appraisal process.
      2. The Company Should convey in writing to the borrower in the vernacular language as understood by the borrower by means of Loan Card and Loan Agreement, the amount of loan sanctioned along with the terms and conditions including annualised rate of interest and method of application thereof and keep the acceptance of these terms and conditions by the borrower on its record.
      3. The Company shall provide a copy of the loan agreement preferably in vernacular language along with a copy each of all enclosures quoted in the loan agreement to all the borrowers at the time of sanction / disbursement of loans.
      4. Company shall mention the penal interest charged for late repayment and loan prepayment charges in bold in the loan agreement for Individual Loans wherever applicable. However, late repayment and prepayment charges are not applicable for group loans.
    3. Disbursement of loans including changes in terms and conditions
      1. The Company should give notice to the borrower in the vernacular language as understood by the borrower of any change in the terms and conditions including disbursement schedule, interest rates, service charges, prepayment charges etc.
      2. Should also ensure that changes in interest rates and charges are effected only prospectively. A suitable condition in this regard should be incorporated in the loan agreement.
      3. The decision to recall / accelerate payment or performance under the agreement should be in consonance with the loan agreement.
      4. The Company shall release all securities on repayment of all dues or on realisation of the outstanding amount of loan subject to any legitimate right or lien for any other claim the Company may have against borrower. If such right of set off is to be exercised, the borrower shall be given notice about the same with full particulars about the remaining claims and the conditions under which NBFCs are entitled to retain the securities till the relevant claim is settled / paid.
    4. All sanctioning and disbursement of loans should be done only at a central location - branch premises - and more than one individual should be involved in this function. In addition, there should be close supervision of the disbursement function.
    5. Adequate steps shall be taken to ensure that the procedure for application of loan is not cumbersome and loan disbursements are done as per pre-determined time structure.
    6. The effective rate of interest charged on each loan products, fees and other charges should be prominently displayed in all branches, regional & head office and in the literature issued (in vernacular language) and on website.
    7. A statement shall be made in vernacular language and displayed at Ujjivan premises and in loan cards articulating commitment to transparency and fair lending practices.
    8. Disclosures in Loan Agreement / Loan Card
      1. a) All the terms and conditions of the loan,
      2. b) the effective rate of interest charged,
      3. c) the pricing of the loan involves only three components viz; the interest charge, the processing charge and the insurance premium (which includes the administrative charges in respect thereof),
      4. d) there will be no penalty charged on delayed payment,
      5. e) no Security Deposit / Margin is being collected from the borrower,
      6. f) the moratorium between the grant of the loan and the due date of the repayment of the first instalment is equal or more than the frequency of repayment,
      7. g) an assurance that the privacy of borrower data will be respected,
      8. h) information which adequately identifies the borrower ,
      9. i) acknowledgements by the NBFC-MFI of all repayments including instalments received and the final discharge, and
      10. j) the grievance redressal system and the national toll-free customer care helpline number printed on the loan card and displayed at branches.
      11. k) Non-credit products (insurance) issued shall be with full consent of the borrowers and fee structure shall be communicated in the loan card itself.

    Note: Ujjivan has a Board approved, standard form of loan agreement and the same is given to customers in vernacular language.


  5. Core Values:

    • To ensure that clients are protected against fraud and misrepresentation, deception or unethical practices.
    • To ensure that all practices related to lending and recovery of loans are fair and maintain respect for client's dignity and with an understanding of client's vulnerable situation.
    • To ensure that staff and persons acting on their behalf are oriented and trained to put this Code into practice.

    Operating Guidelines:

    1. 1) Fair Practices
      1. All dealings of the Company with customers should be open, fair and ethical.
      2. All Employees of Ujjivan shall treat customers with respect and dignity.
      3. Ujjivan must ensure that the provision of micro finance services to eligible clients is as per RBI guidelines.
      4. Ujjivan shall ensure that the rates of interest & charges are in accordance with Reserve Bank of India guidelines.
      5. The rate of interest should be annualised rates so that the borrower is aware of the exact rates that would be charged to the account.
      6. The rate of interest and the approach for gradations of risk and rationale for charging different rate of interest to different categories of borrowers shall be disclosed to the borrower or customer in the application form and communicated explicitly in the loan agreement.
      7. The rates of interest and the approach for gradation of risks shall also be made available on the web-site of the Company. The information published in the website should be updated whenever there is a change in the rates of interest.
      8. Ujjivan should refrain from interference in the affairs of the borrower except for the purposes provided in the terms and conditions of the loan agreement (unless new information, not earlier disclosed by the borrower, has come to the notice of the Company).
      9. The Company must obtain copies of relevant documents from clients, as per standard KYC norms. Additional documents sought must be reasonable and necessary for completing the transaction.
      10. In case of receipt of request from the borrower for transfer of borrowal account, the consent or otherwise i.e. objection of the Company, if any, should be conveyed within 21 days from the date of receipt of request. Such transfer shall be as per transparent contractual terms in consonance with law.
      11. Products should not be bundled. The only exceptions to bundling may be made with respect to credit life, life insurance & live-stock insurance products (if applicable), which are typically offered bundled with loans. The terms of insurance should be transparently conveyed to the client and must comply with RBI & Insurance Regulatory and Development Authority (IRDA) norms. Consent of the client must be taken in all cases.
      12. Training if any, offered to the borrowers shall be free of cost. Field staff shall be trained to offer such training and also make the borrowers fully aware of the procedure and systems related to loan / other products.
    2. 2) Avoiding Over-indebtedness
      1. Field staff shall be trained to make necessary enquiries with regard to existing debt of the borrowers.
      2. Due diligence shall be carried out to ensure the repayment capacity of the borrowers.
      3. Make best efforts to ensure that the loans provided are within the customer's capacity to repay and avoid over-indebtedness.
      4. Shall ensure mandatory credit bureau checks for all loans.
      5. If a client has loans from 2 separate MFIs then Ujjivan shall not be the third lender to that client.
      6. Ujjivan must not exceed the total debt limit for any client, as prescribed by RBI.
      7. Shall educate clients on ill effects of over-borrowing.
    3. Appropriate Interactions and Collection Practices
      1. Ujjivan shall ensure that the staffs are adequately trained on collection policy and to deal with the customers in an appropriate manner.
      2. Staff must use courteous language, maintain decorum, and are respectful of cultural sensitivities during all interaction with clients.
      3. In the matter of recovery of loans, the Company and its employees should not follow coercive collection practices such as collecting at odd/late hours or during bereavement / sickness of customers, behaving rudely / aggressively, or use of muscle power during collection etc.
      4. Only employees and not out sourced recovery agents be used for recovery.
      5. Ujjivan shall have a detailed board approved policy for dealing with clients, at each stage of default
      6. Customers who are facing serious debt repayment problems for reasons beyond their control can approach the branch for rescheduling their loans; this should be part of Debt Rescheduling policy and to be disclosed to borrowers in loan agreement and CGT brochures in vernacular language.
      7. Staff shall provide a valid acknowledgement / receipt for each and every payment received from the borrower.
      8. A declaration that the Company will be accountable for preventing inappropriate staff behaviour and timely grievance redressal shall be made in the loan agreement and also in the FPC displayed at branch premises.

    Core Values:

    • To safeguard personal information of clients, allowing disclosures and exchange of relevant information with authorized personnel only, and with the knowledge and consent of clients.

    Operating Guidelines:

    1. The Company shall respect customers' privacy and shall treat customer information as private and confidential.
    2. An adequate disclosure shall be made in loan agreement on sharing client data with credit bureaus, statutory organizations, sister concerns and third parties and the acceptance of the borrower shall be obtained for internal records.
    3. Field staff shall be trained on fidelity and secrecy of client and Ujjivan data during their basic level training. All staff shall sign a declaration on fidelity and secrecy as part of their joining formalities.


    Core Values:

    • To provide clients formal and informal channels for feedback and suggestions.
    • To consistently assess the impact of services in order to enhance competencies and serve clients better.
    • To provide a formal grievance redressal mechanism for clients.
  8. Company has a Board approved Grievance Redressal Policy given below which provides guidelines for receiving, handling and disposal of customer grievances, documentation, turn-around-time and escalation matrix for unresolved complaints and periodical review mechanism.

Grievance Redressal Policy (GRP)

Prompt and efficient Customer Service is the key to success of any service organization. To maintain a consistent business growth, it is necessary to look at both, to widen the customer base and to retain the existing customers. We at Ujjivan aim to satisfy the Customers and delight them with our services. As any thriving organization faces, there are always some instances of complaint that arise. The policy aims to define the process that allows for us to deal with all such matters.


The policy aims to minimize the instances of customer complaints through proper service delivery and review mechanism and to ensure prompt redressal of customer's grievances. The review mechanism would help in identifying shortcomings in product features and service delivery. Hence, the Policy's objective is…..

  • To provide clients formal and informal channels for feedback and suggestions
  • To provide a formal grievance redressal mechanism for clients
  • To educate customers on grievance redressal mechanism
  • To ensure that clients are protected against fraud, deception or unethical practices
  • To handle/resolve complaints speedily and efficiently
  • To consistently assess the impact of services in order to serve clients better


The following document serves to provide the details of grievance redressal mechanisms for customers and the procedure the employees at Ujjivan need to follow when such a complaint arises.

Mode of Complaints
Considering customer profile, their literacy level and vulnerability, Ujjivan has identified various channels of sourcing customer complaints proactively.

  1. Customer Enquiries / Complaints received at field

    Customers can submit their written or verbal enquiries / complaints to any Ujjivan staff who meets them at any forum such as center meetings, CGTs, GRTs and exit interviews etc. These enquiries / complaints shall be forwarded to CCR/CRM of the branch and Regional Helpdesk for further follow up and resolution. Ujjivan has introduced Customer Connect Program; this mandates supervisors and staff of all functional teams to visit customers during center meetings to seek their feedback and understand their needs. If any complaints are received during center meeting visit then visitor should update the same in Center Meeting Checklist available in Uconnect, a web tracker, Regional Helpdesk will investigate the issue with the assistance from Distribution supervisors and provides resolution to customer.

  2. Customer walk-ins at branches/ROs:
    • Verbal Complaints – Customer Care Representative (CCR) or Customer Relationship Manager (CRM) will record the complaints and provides the solutions
    • Written Complaints – Customer can obtain Complaint Form (See Annexure 1) and fill her complaint details (branch staff will assist if customer is not literate), all written complaint forms shall be sent to Complaint Resolution Officer thru post/courier. Branches should keep minimum 5 hard copies of customer complaint forms at CCR or CRM desk for customers' usage.
  3. Customer Call-ins:
    • Customer calls to branch's phone number – CCR or CRM of the branch will record the complaint, does follow ups and provides the resolution
    • Customer calls to Regional Helpdesk Number – Helpdesk representatives will record the complaint, escalate to supervisors who can resolve problem and provides customer with solution
    • Customer calls to Complaint Resolution Officer – Customers can call or write to CRO to escalate their unresolved grievances
  4. Whistle Blower:

    A Whistle blower is an Ujjivan employee who gives complaint against a colleague who allegedly involved in prohibited activities and breaches code of conduct such as fraud, misappropriation of funds, unethical behavior, mistreatment of customers etc. A whistle blower would also be a customer who gives complaint against an employee or/and customer of Ujjivan who allegedly involved in prohibited activities such as mentioned above. In this regard, internal staff or customer of Ujjivan can call Regional Helpdesk or Complaint Resolution Officer and submit their complaint. Investigations will occur and appropriate actions will be taken. (Caller name will be kept confidential if requested)

    However, the caller should have enough evidence on correctness of the customer grievance and should avoid raising unrealistic complaints. A whistle blower reporting unrealistic complaints shall not be punished if the complaint was raised with good intention and if there enough grounds to suspect a colleague. A staff reporting unrealistic complaints with a bad intention/motivation is liable to receive a disciplinary action i.e. oral warning on first instance and a written warning in case of repetition.

  5. External Complaints :

    Complaints received from (on behalf of customer or on the basis of public interest) general public & other stake holders such as Govt agencies, RBI, police, lawyers, industry ombudsman (AKMI & MFIN etc) & social activists will also be recorded at either branch level or regional helpdesk level and provided with appropriate solutions. Hence, any staffs who receive complaints from such agencies should escalate them to Complaint Resolution Officer immediately.

Complaint Resolution Process & Documentation

CCRs and Regional helpdesk will use Vtiger, a software solution for documenting and tracking customer grievances. In case branch does not have a CCR, then CRM of the branch should use a simple excel tracker to document and report customer complaints. The process to be followed by CCR, CRM and Regional Helpdesk is given below.

Steps CCR (for CCR branches) & Regional Helpdesk CRM (for Non-CCR branches)
Step 1 Log the complaint in Vtiger (CRM tool) Fill Excel Complaint Tracker and send to Regional Helpdesk
Step 2 Provide reference number to customer Helpdesk will fill the complaint in Vtiger and provides CRM with reference number
Step 3 Send complaint details to the "Owner" who will be responsible for resolution and keep Complaint Resolution Officer in Loop Helpdesk send complaint details to the "Owner" who will be responsible for resolution and keep Complaint Resolution Officer in Loop
Step 4 Log resolution details in Vtiger Helpdesk will log resolution details in Vtiger
Step 5 Convey resolution details to customer Helpdesk will convey resolution details to customer/CRM

Turn-around Time: - All complaints will be resolved within specified time at each level mentioned herein below;
Level 1 & 2 – CCR/CRM & Regional Helpdesk – 3 working days
Level 3 – Complaint Resolution Officer – 5 working days

Escalation Matrix:-

All complaints which are not resolved within 3 working days from receipt of customer complaint by CCR/CRM/Helpdesk should be escalated to Complaint Resolution Officer of the respective Region. Complaint Resolution Officer should provide the resolution to customer within 5 working days from the receipt of the complaint. Any delays in this regard should be escalated to COO of the Region. Software solution, Vtiger, has been customized to trigger automated escalations for unresolved complaints.

If the complaint / dispute is not redressed by Ujjivan within a period of one month, the customer may appeal to the Officer-in-Charge of the Regional Office of DNBS of RBI – Bangalore. Branch display on grievance redressal mechanism should also contain contact details of both Ujjivan's Complaint Resolution Officer and the Officer-in-Charge of Regional Office of the RBI.

Assessing completeness of resolution: -

Repeated Complaints: - Each time a customer calls, there must be check to determine whether the call is regarding a new issue or a "follow up" call. Each personnel who receive the complaint must ensure that a follow up call can be traced back to the original call using the call reference number or the customer details. There must be immediate action and resolution sought in case of repeated complaints

Cross Check: - Regional Service Quality Team is responsible to call complainants on random sample basis to assess satisfactory and timely resolution of complaints.

FLOWCHART (General Process of Complaint Resolution)

Internal Process
All grievances will be segregated based on their severity and criticality. Severity here is defined as the intensity of loss to the customer and to the company. Grievances if necessary will be forwarded to concerned departments for further action.

The grievances of the customers will be categorized in three levels based on their severity. For example,

IssueLevel 1Level 2Level 3Level 4
Fraud CasesYes
Staff MisbehaviorYes
Service Delays or Service DefectsYes

NOTE: This list will be amended as per need
LEVEL 1: Integrity Issues, Revenue loss, etc.
LEVEL 2: Disciplinary, Misbehavior concerns, etc.
LEVEL 3: Disbursements delays, loan application delays, center meeting delays, etc.
LEVEL 4: Others, such as Co-ordination concerns in customer's group, centre, meeting place, etc.
All levels of grievances will be treated equally with the same sense of urgency and speed. However the resolution given and the action taken might vary depending on the severity.

Roles & Responsibilities
The following individuals and departments have onus when a complaint is raised.

  1. Customer Care Representative: These personnel are placed at the branch and are available for the customers to place their complaints directly through walk-ins or phone calls.
  2. Branch Staff (CRM/CRS/Cashier/Others): If there is no Customer Care Representative, CRM should record the complaint in tracker and should forward the same to regional helpdesk. During CRM's absence, the branch staffs have to provide the customer with the contact information of the regional helpdesks and Complaint Resolution Officer.
  3. Distribution Supervisors: Distribution supervisors are responsible to ensure timely resolution of critical / unresolved issues which are escalated to them
  4. Help Desk Representatives: Each Regional Office has a Help Desk team that works from 9:00am to 6:00pm on week days. All complaints will be registered and resolved through phone. They will follow the grievance redressal escalation process, if the resolution is not found in the given time frame. Helpdesk is also responsible for calling customers (who registered their complaints at branches) on random sample basis to cross-check on customer's satisfaction & timeliness of complaint resolution.
  5. Complaint Resolution Officer: Service Quality Manager of each Region will be designated as Complaint Resolution Officer. Responsible for overall management of grievance redressal process at a Region and ensuring all customer grievances are addressed within the promised time frame. Also responsible for submitting periodical reports on status of Customer grievances to the Regional/National Leadership Team & Board
  6. Chief Operating Officer (for Final Escalation): Complaint Resolution Officer shall escalate all complaints which are unresolved after standard TAT to COO of the respective region. COO shall take up the complaint with concerned supervisor for immediate resolution.
  7. Vigilance Department: If the grievance raised is related to a fraud accusation against a customer or an employee of Ujjivan, this is escalated to the Regional Vigilance Department for their respective procedure.
  8. Human Resources: When there is a proven fraud case or customer abuse case against an employee of Ujjivan, this information has to be forwarded to the HR team so that further action can be taken.
  9. Audit Department: Audit officers, during their customer meets, shall check customer awareness level on grievance redressal process (whether customers are aware of toll-free number and CCR concept) and advice branch accordingly. If there is any service defects or customer complaints found in the field should be updated in center meeting visit checklist. Audit shall also check whether the branch displayed latest FPC posters properly or not? Are there any pending customer complaints for more than prescribed TAT? Crosschecking with few customers on satisfactory and timely resolution of complaints can also be done by Auditors.


  1. Human Resource Dept should have code of conduct for field staff recruitment, training and supervision. There should be minimum qualification necessary for the field staff and shall have necessary training tools identified for them to deal with the customers. Guidelines provided in Industry Code of Conduct by MFIN & Sadhan, which was already approved and adopted by Board, should be implemented effectively.
  2. Staff Education: All field staff shall be mandatorily trained on below mentioned concepts as part of their Basic Level Training (Induction) and refresher trainings at periodical intervals:
    1. The importance of Fair Practices Code (FPC)
    2. The importance of Grievance Redressal Mechanism
    3. Their role in effective implementation of above policies
    4. Various methods and best practices of FPC implementation
    5. Basic communication and soft skills to inculcate appropriate behaviour towards borrowers without adopting any abusive or coercive debt collection / recovery practices.
  3. Compensation methods and performance review of staff should have more emphasis on areas of service and borrower satisfaction.
  4. Penalties shall also be imposed on cases of non-compliance of field staff with the Code of conduct.
  5. All branches, regional & head office of Ujjivan shall prominently display a simplified Fair Practices Code & Grievance Redressal Mechanism (See Annexure 2) in vernacular language for client's information.
  6. A copy of this FPC & Grievance Redressal Policy should be put up on the website for the information of various stake holders.
  7. Client Education: Customers should be educated on the Fair Practices Code, grievance redressal mechanism and escalation matrix for their unresolved complaints, options, choices and responsibilities vis-à-vis financial products and services available. Client education to be made thru both printed education materials and also effective verbal communication as the literacy level among clients is generally low.
  8. New clients must be informed about the organization's policies and procedures to help them understand their rights as borrowers.


  1. Service Quality (SQ) Department is authorized and responsible to execute the Fair Practices Code and Grievance Redressal Mechanism
  2. SQ team shall co-ordinate with all functional departments to ensure their respective areas of Fair Practices Code are implemented effectively
  3. Must ensure regular checks on client awareness and understanding of the key terms and conditions of the products/ services offered / availed and grievance redressal system, as part of internal audit systems and through some other regular monitoring)
  4. Implementation of the FPC and Grievance Redressal Mechanism should be reviewed at Regional and National leadership team level on monthly basis
  5. A consolidated report on functioning of the grievance redressal mechanism should be submitted to the Board on quarterly basis

The Policy on FPC shall be reviewed for any revisions and shall be placed before the Board on an annual basis for their review and approval. The copy of the approved policy shall be filed with RBI DNBS department for their reference and information.

Annexure - 1

Complaint No…………..
Of Year…………

(TO BE FILLED UP BY THE CUSTOMER – Branch staff can assist if customer is not literate)


Complaint Resolution Officer,
Ujjivan Financial Services Pvt Ltd,
Grape Garden, No. 27, 3rd A Cross,
18th Main, Koramangala 6th Block,
Bengaluru 560 095
Dear Sir/Madam,

Sub: Complaint on: ___________________ ________               Branch Name: ________________

The details of my/our complaint are as under:                             Center & Group No: ____________
Name of Customer: _____________________________           Contact No: __________________
Full Address of the Customer: ____________________________________________________
Customer ID: __________________________________            Loan A/c Number: _____________

Details of Complaint, Documents Attached, etc –
(If space is not sufficient please enclose separate sheet)
DECLARATION – I/WE, the Customer/s herein declare that:
(a) The information given above is true and correct; and
(b) I/We have not hidden or misrepresented any fact in the above complaint and in the documents submitted herewith.

Yours Faithfully

(Signature of Customer/s)

Annexure - 2

© 2019 Ujjivan Financial Services Ltd. CIN NO: L65999KA2004PLC035329
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