ALLAHABAD BANK

Retail Credit Department

Head Office: 2, Netaji Subhas Road, Kolkata – 700 001
Instruction Circular No.15448/Retail Credit/2017-18/27 Date: 16.01.2018

To All Offices & Branches

AllBank Pensioners’ Personal Loan

(Earlier known as Pensioners’ Personal Loan)

Attention of Branches / Offices is drawn to Head Office Instruction Circular No. No.
10874/Retail Credit/ 2009-2010/16 dated 08.02.2010 & 11662/ Retail Credit/ 2011-12/19
dated 01.12.2011 on “Pensioners’ Personal Loan”.

 Based on the feedback received from the field, need of Pensioners and to boost
portfolio under the scheme, various modifications have been carried out. Efforts have
been made to make the product very lucrative for Pensioners in general and Allahabad
Bank Pensioners in particular.

 The major modifications made in the schemes are:

 Increase in quantum of loan to Rs.5.00 Lac for Pensioner up to 65 years of Age &
Rs.2.00 Lac for Pensioners above 65 years of Age.

 Inclusion of new category of Pensioners i.e Defence Pensioner. Maximum Quantum

of loan has been fixed at Rs.10.00 Lac for Pensioner up to 65 years of Age &
Rs.2.00 Lac for Pensioners above 65 years of Age.
 Rate of interest has been reduced to MCLR+2.00%.
 Rate of interest applicable to Allahabad Bank Pensioners (staff) is @MCLR.
 Repayment Period has been extended to 60 Months from existing 48 months.

 The revised guidelines are enclosed as “Annexure – A”. The revised guideline will be
applicable to new sanctions only.

 The documentation of the loans extended under “AllBank Pensioners’ Personal

Loan” scheme shall be done in the same format as that of erstwhile “Allahabad Bank
Personal Loan Scheme for Pensioners” with suitable modification.

 The key features of “AllBank Pensioners’ Personal Loan” scheme should be

displayed prominently at all the Branches/ Delivery Channels.

 All the Offices/ Branches are advised to take a careful note of the contents above and
ensure meticulous compliance.

 Hindi version of the circular will follow shortly.

(Sudhanshu Gaur)
General Manager
(PSC, FI, SME & Retail Lending)
 (ANNEXURE – A)
AllBank Pensioners’ Personal Loan
Sl. PARAMETER REVISED GUIDELINES
No.
01 Target Group & All state Govt., central Govt. and our bank Pensioners whose
Eligibility monthly pensions are credited in the accounts maintained by them
Criteria with our branches.

The pensioners are divided in the following two categories:

1. Pensioners whose PPO is with our bank and the family

pensioner as mentioned in the pension payment order (PPO) is
alive and ready to accept full liability of outstanding loan in
case of death of pensioner.
2. Pensioners whose PPO is with our bank but family pensioner
is not alive or the applicant himself is family pensioner.

02 Definition Pension means basic pension plus dearness relief at the time
of sanction of credit facility.

03 Age Age of the pensioner must not exceed 70 years (Seventy years)
as on the date of disbursement of loan and loan should be fully
repaid before attaining the age of 75. The date of birth should
be reckoned as mentioned in the PPO held with the bank /
disbursing agency or the date of birth mentioned in the identity
card issued by the employer.

04 Purpose The personal / domestic requirement but not for speculative

purpose.

05 Quantum of (A) For Defence Pensioners:

Loan  Pensioners up to 65 years of age – An amount equivalent
of 24 months’ pension inclusive of relief subject to the
maximum limit. Rs 10.00 Lac
 Pensioners above 65 years of age – An amount
equivalent of 10 months’ pension inclusive of relief
subject to the maximum limit. Rs 2.00 Lac

(B) For Other Pensioners:

 Pensioners up to 65 years of age – An amount equivalent
of 18 months’ pension inclusive of relief subject to the
maximum limit Rs 5.00 Lac
 Pensioners above 65 years of age – An amount
equivalent of 10 months’ pension inclusive of relief
subject to the maximum limit. Rs 2.00 Lac
( Age will be reckoned as on date of sanction of loan)
 Minimum loan amount – Rs 25000/-
 Branch must ensure that after deduction of the monthly
installment and adjustment of excess pension paid to him, if any,
the concerned pensioner is drawing 50% of the pension
amount.

Net Monthly Income to EMI (NMI/EMI) ratio should be more

than 2.

06 Margin NIL
07 Rate of interest 1 YMCLR + 2.00 %.
For Allahabad Bank pensioner (staff) @ 1 Y MCLR.

08 Processing Fee No Processing Fee to be charged

09 Repayment Maximum 60 months. Loan must be repaid before the attainment

Period of 75 years of age.

10 Disbursement By credit to his / her (Principal Borrower) S/B account

11 Mode of The entire loan and interest will be repaid by equated monthly
Repayment installments from the pension credited in the Borrowers account.

Debit authority must be obtained from the borrower to debit the

amount of monthly installment to his/her S/B account (Pension
account) for liquidation of the personal loan. The debit authority
shall remain in force till the entire loan with accrued interest is
liquidated.

12 Collateral In case of pensioners falling under the Category 1 –

Security  Personal Guarantee of the family pensioner as mentioned in the
PPO.
 An undertaking from family pensioner that in the case of death
of pensioner(Borrower) the entire liability of personal loan
outstanding in the name of deceased pensioner will be taken
over by him/her as per agreed terms of sanction.
 An undertaking from family pensioner, authorizing the Bank to
adjust the Insurance claim amount first toward liquidation of the
outstanding, if any in the loan account of the deceased
pensioner and the balance amount be paid to him / her, after
observing all the formalities.

In case of pensioners falling under the Category 2 –

 Pledge of liquid securities like NSC / KVP / FDR/ DDP (
including accrued interest)/ etc. covering 25 % of loan amount
standing in the name of borrower or in the name of third
party/parties provided he / she is ready to guarantee the loan.
  Guarantee from 2 persons having individual net worth equal to
two times of loan amount, preferably from legal heirs / son /
spouse / daughter.

An Undertaking to be obtained from legal heirs is enclosed as

ANNEXURE-B.

13 Delivery All Branches

Channel
14 Rating Rating of Accounts to be done under Retail Score Card Module in
APPS Store.

15 Discretionary Scale I & Scale II – Rs 2.00 Lacs for all pensioners.

Authority Scale III to Scale VII –For Defence Pensioner- Rs.10.00 Lac and
For Other Pensioners – Rs.5.00 Lac
 ANNEXURE-B
Undertaking by the Legal Heirs

I/we.................... Son/ Daughter of Shri.................... residing at ..............................do

herby affirm and undertake as under:-

1. That Shri/Smt............................son/Daughter of.........................R/o.............................

is related to me as my ....................... (mention relationship) and he/ she has availed
following loan / credit facility from .......................Branch of Allahabad Bank.

(Details of credit facility)

2. That the following are the only legal heirs of Shri/Smt........................ (Borrower) as
on the date and are beneficiary in the aforesaid loan /credit facilities availed by
Shri/Smt .........................(Borrower)

Sl.No Name of the Legal Address Age Relationship

Heirs

3. That out of aforesaid legal heirs Master/Kumari............................. age .......... years

is a minor he/she is being represented Shri .................................. who is none other
than his natural guardian.

4. That, I/We also understand and agree that till the settlement of the Bank’s dues in
the aforesaid loan, the pension account/family pension shall be subject to Bank’s
lien.

5. That in consideration of loan/ credit facility amounting to Rs..........................

extended to Shri .............................. by............................. Branch of Allahabad, I/we
hereby undertake to liquidate/repay the outstanding balance in the aforesaid loan
account as and when demanded by the Bank and further undertake to indemnify and
keep indemnified the bank for all times hereafter against all loss, costs claims
charges, expenses etc borne / to be borne by the Bank for liquidation of the loan
amount.

Signature of Legal Heir/s

Name & Relation