Lok Sabha Question No. 2469 (UNSTARRED), answered on 2025-12-15
Subject: Increase in Interest Rates of NBFCs
Ministry: FINANCE
Asked by: Shri Azad Kirti Jha

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UNSTARRED QUESTION NO- 2469

ANSWERED ON MONDAY, DECEMBER 15, 2025/ AGRAHAYANA 24, 1947 (SAKA)

## Increase in Interest Rates of NBFCs

## 2469. SHRI AZAD KIRTI JHA:

Will the Minister of FINANCE be pleased to state:-

- (a) whether the Government or the Reserve Bank of India have received complaints relating to unilateral increase in interest rates by Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs), if so, the details thereof;
- (b) whether complaints have also been received regarding extension of loan tenures without the borrowers'  prior  consent  and  the  non -availability  of  opt-out  mechanisms,  if  so,  the  details thereof;
- (c) whether the Government has taken note of the violations of guidelines relating to switching between floating and fixed rate structures for home loans, if so, the details thereof; and
- (d)  whether  complaints  have  been  received  regarding  imposition  of  pre-payment  penalties  on borrowers seeking to transfer home loan accounts to other lenders and if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (SHRI PANKAJ CHAUDHARY)

- (a):  As  per  Reserve  Bank  of  India  (RBI)  data,  the  complaints  received  against  Non-Banking Financial Companies (NBFCs) for FY 2024-25 with respect to increase in interest rates along with other discrepancies pertaining to interest rates are given below:

| Particulars                                                                               |   No. of Complaints |
|-------------------------------------------------------------------------------------------|---------------------|
| Excessive interest charged / discrepancy in interest charged                              |                 493 |
| Changes in interest rate/ annualized interest rate not communicated as per RBI guidelines |                 141 |
| Changes in interest rate effected retrospectively                                         |                 104 |
| Issues related to change of benchmark regime for floating interest rates                  |                  56 |
| Total                                                                                     |                 794 |

As per the data received from National Housing Bank (NHB), it has received a total of 1196 complaints  (615  complaints  on  Centralized  Public  Grievance  Redress  and  Monitoring  System (CPGRAMS) and 581 complaints on Grievance Registration and Monitoring System-GRIDS) pertaining  to  rate  of  interest  (including  excess  rate  of  interest)  for  the  period  1.10.2024  to 30.9.2025.  It  is  to  be  mentioned  that  the  complaints  received  on  CPGRAMS,  includes complaints related to rate of interest (ROI)/excess ROI/tenure extension.  As on date, all these complaints have been closed, and the companies are advised to follow the guidelines.

(b):  As  per  RBI data, a total of 123 complaints have been received pertaining to extension of loan tenures without intimation in FY 2024-25. Also, as per the data received from NHB, during the  period  1.10.2024  to  30.9.2025,  it  has  received  69  complaints  related  to  extension  of  loan tenures without the borrowers' consent on the GRIDS portal.

(c): As per RBI data, a total of 56 complaints have been received with respect to issues related to change of benchmark regime for floating interest rates. According to RBI (NBFC - Responsible Business Conduct) Directions, 2025, at the time of reset of interest rates, an NBFC/HFC may, at its option, provide a choice to the borrowers to switch over to a fixed rate as per their Board approved policy. The policy, inter alia , may also specify the number of times a borrower will be allowed to switch during the tenor of the loan.

Also,  all  applicable  charges  for  switching  of  loans  from  floating  to  fixed  rate  and  any  other service  charges/administrative  costs  incidental  to  the  exercise  of  the  above  options  shall  be transparently disclosed  in the  sanction  letter  and  also  at  the  time  of  revision  of  such charges/costs by the NBFC/HFC from time to time.

(d):  As  per  the  data  received  from  NHB,  during  the  period  1.10.2024  to  30.9.2025,  it  has received  a  total  of  528  complaints  (351  complaints  on  CPGRAMS  and  177  complaints  on GRIDS) related to imposition of prepayment charges/ pre-closure charges on borrowers and delay in issuance of foreclosure letter. As on date, all these complaints have been closed, and the companies are advised to follow the guidelines.

As  per  RBI's  Pre -payment  charges  on  loans,  Directions,  2025,  applicable  to  all  loans  and advances  sanctioned  or  renewed  after  1.1.2026,  a  Regulated  Entity  (RE)  shall  not  levy  prepayment  charges  on  all  floating  rate  loans  and  advances  granted  for  purposes  other  than business to individuals, with or without co-obligant(s).

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