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RESERVE BANK OF INDIA

www.rbi.org.in

CO.HRMD.No.G.166 /23628 / 17.48.00/2015-16

May4,2016
Vaishakha 14,1938 (s)
The Regional Director,
The Chief General Manager-in-Charge/
Chief General Manager/
General Manager-in-Charge
Principal,
_
Reserve Bank of India

Dear Sir/Madam
Education Loan, Computer Advance, Consumer Advance, Vehicle Advance and LFC Incidental
Advance - Review - Personal Advance
At present

employees/Officers

Educational

of the Bank are granted loans under various heads viz.

Loan to cover a part of the expenditure incurred by them on professional courses of

their dependent

children, Advance

Advance for purchase

for

of consumer

purchase

of Personal

Computer

articles, Advance for purchase

(laptop/Tablet),

of Motor vehicles and

LFC Incidental Advance.

2.

In order to allow flexibility to Officers/employees to utilize the loan amount, depending on

their priorities/requirements,

it has been decided to club the aforesaid loans/advance into a single

advance under the nomenclature

"Personal Advance".

The salient features

of "Personal

Advance" are as under:

(A) Entitlement:
(i) The maximum quantum of Personal Advance will be as under:
Category

Quantum

Officers

~ 29 lakh

Class III

~ 25 lakh

Class IV

~ 21 lakh

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Central Office, 20th Floor, Central Office Building. Shahid Bhagat Singh Marg. Mumbai - 400 001 India

Tel: (022) 2260 1000 Fax: (022) 2266 1892 E-mail: cgminchrmd@rbi.org.in

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(ii) Within the overall ceiling the maximum

Car/Scooter/Motor
respectively.

Similarly

Employees

Consumer

the maximum

(iv)

Articles,

Education

Computer,

An employee

in instalments.

or LFC Incidental

less the total amount

Eligibility

Articles,

year and in multiples

the broad advance

earlier

the

will be permitted

Travel will be

to withdraw

Advance

Personal

in respect

amount

quantum

mentioned

the advance

only

will be treated

Computer,
advance

as

of Motor Vehicle,
Advance.

in one lumpsum

would be arrived at by reducing

Each withdrawal

Personal

of Vehicle,

the entire advance

entitled

head and will have different

of Advance:

for Personal

of children and LFC Incidental

or

the total amount

in para

2 (i) above.

three times in a calendar

as a different

advance within

EMls.

will have to apply for the Personal Advance

(B) Purpose

Class III and Class IV

will be eligible for grant of personal

Education

from

of Rs 25,000/-.

for purchase

of loan availed earlier

for further withdrawals

availed

can be availed

of Motor

for Officers, Class III and Class IV respectively.

Consumer

an employee

Employees

which

will have an option to withdraw

of loan/advance
However,

advance

who have availed of Loan/Advance

per the above quantum

Personal

which can be availed for purchase

Cycle will be ~1 0 lakh, ~6 lakh and ~4 lakh for Officers,

~2 lakh, ~1 lakh and ~75,000/(iii)

advance

in Samadhan,

can be availed

on and after July 1,2016.

by the employee

for the following

purposes
education

of their children,

purchase

of Motor Car/Scooter/

Motor Cycle,

purchase of Consumer Articles,

purchase

of Computer

/ Laptop / Tablet, etc.

for personal travel.

(C) Eligibility:
(I) Officers / employees

in regular employment

who have put in at least two years' service and are

not due to retire within one year from the date of application
of 'at least one year's

remaining

the advance for education

(II)

Officers

respectively,

service'

purposes

and Workmen

may be waived

for advance.

However,

if the officer / employee

the condition
is applying for

has sufficient free PF balance to cover the advance,

employees

will

be eligible

for

Rs.2,OO,OOO/- and

during the first two years of joining the Bank subject to the following

Rs.1,00,000/-

conditions:

../3

i)

The advance will be granted only for purchase of consumer articles.

ii)

Balance amount of the advance in such case may be availed of on completion of two
years' service in the Bank.

iii)

In the event of his/her resignation/dismissal

from Bank's service, the outstanding

amount of advance together with accrued interest thereon may be recovered from
dues payable to him/her. If the dues payable are not sufficient to cover the advance,
the employee will be liable to repay the outstanding amount in one lump sum.
iv)

In case an Officer/employee

who has availed Personal advance for purchase of

consumer articles in terms of the aforesaid instructions

resigns from the Bank's

service before completion of two years of service penal interest of 5% above the rate
at which the advance was sanctioned will be charged on the personal Advance
availed by him/her.
(III) The Personal Advance may be granted separately to both spouses working in the Bank as
per their individual eligibility.
(IV) Part time employees:

The part time employees may be granted a Personal Advance of

Rupees one lakh for purchase of consumer articles only. The minimum service requirement and
various other terms and conditions for grant of Personal Advance to part time employees will be
the same as applicable to the full time employees of the Bank.
(V) The part-time BMOs placed

in Grade 'C' will be eligible for grant of Personal Advance for

purchase of Motor Car/Scooter/Motor

vehicle subject to the same limit and on the same terms

and conditions for grant of Personal Advance for purchase of Motor Car/Scooter/Motor vehicle
as applicable to full time officers of the Bank
(0) Rate of Interest: Interest will be charged @ 6.5% per annum for the entire loan. The rate of

interest on loans/advances already availed by the employee viz. Education loan, Advance for
purchase of Personal Computer(laptop/i-pad),

Consumer Article, purchase of Motor vehicle, LFC

Incidental Advance will be revised to 6.5% per annum with effect from July 1, 2016.
(E)

Repayment:

(a) The Principal will be recovered in 120 equal monthly instalments subject to a minimum of
Rs 1000/- per instalment. Thereafter, the interest will be recovered in monthly instalments
equivalent to the amount of the last instalment of Principal amount.

.. .14

4
(b) Recovery of loans/advances

i.e. Education

Loan, Advance

for Purchase

of Personal

Computer, Consumer Article, LFC Incidental and lor Motor vehicle already availed by employees
will continue at the current EMls.
(F) Documentation:

Employees/Officers

will have to submit documents at various stages as

indicated in Annex 'VI '.

All the documents are to be self-attested, scanned and uploaded in Samadhan. Physical copies
of the documents are to be retained by the employee for a period of two years from the date of
purchase of the articles. Bank may, at any time during those two years, require the employee to
submit the physical copies of the documents. Non-submission of physical documents (without
showing reasons acceptable to Bank) may invite disciplinary action. In such case, the Bank will
also recall the advance and the employee will have to repay the entire outstanding amount
(principal + interest) in one lump sum with a penal interest of 5% p.a.
(G) Surety:

No sureties will be required if the sanctioning authority is satisfied that the applicant

employee has sufficient Provident Fund balance (own contribution + interest thereon) to repay the
loan applied for, by him. In other cases and if the employee is a subscriber of National Pension
System (NPS) two sureties from confirmed employees will have to be obtained.
(H) Purchase using Credit I Debit cards - Personal Advance may be availed for goods already
purchased using debit / credit card of the officer / employee.
(I) Utilization

of funds: In case the advance has not been utilized for the purpose for which it has

been sanctioned within one month from the date of drawal and proof of utilisation not submitted
within three months of date of drawal, the employee will be required to pay back the entire
outstanding amount

in one lump-sum along with a penal interest of 5% p.a above the rate at

which the advance was sanctioned. The Bank may also initiate disciplinary action against the
employee.
(J) Other conditions:

(a) The grant of fresh Personal advance would be subject to the condition that the monthly
recovery from the employee's salary towards following shall not exceed 25% of the total monthly
emoluments of the applicants:

.. ./5

Advance from society

Personal advance already availed (including Advance for purchase of Consumer articles,
PC, Motor vehicles availed before July 1,2016)
Personal advance currently applied for
Festival advance
Medical advance
(b)

The condition at (a) above, will not be applicable for employees who avail the Personal

Advance for the purpose of Education of their child/children.

(c) The goods / items purchased with the Bank's assistance should not be pledged, sold,
disposed of or otherwise encumbered till the advance with interest thereon is fully repaid.
(d) Additional Terms and Conditions governing the grant of Personal Advance applied for each
purpose is given in Annex I to V
3.

Officers and workmen employees will be eligible for grant of advance for purchase of Motor

cycle/Scooters/Motor Cars with effect from the date of this circular. All other instructions will come
into effect from July 1, 2016.
4.

The contents of this circular may please be brought to the notice of all Officers/employees

attached to your office/department and a copy may also be given to the local units of the Reserve
Bank of India Officers Association, All India Reserve Bank Staff Officers Association, All India
Reserve Bank Employees Association and All India Reserve Bank Workers Federation.
Yours faithfully

Annex I
Additional Terms and Conditions for Personal Advance applied for purchase of Motor vehicle /
Scooter / Motor Cycle
1. In cases where both husband and wife are employed in the Bank's service want to pool
their vehicle advances to buy one vehicle, both of them would be eligible for the personal
advance as per their individual eligibility. In such case advance would be sanctioned in
Samadhan based on a joint application and payment to seller / dealer would be made
through NEFT.
The spouse in whose name the vehicle is purchased will create the lien on the vehicle and
the lien will not be released till the loan of both husband and wife along with the interest is
repaid fully.

Joint advance will not be available for purchase of motor cycle / scooter)

2. An officer/Class III / Class IV employee who has already purchased a vehicle either from
his/her

own

institutions

resources

or by funds

secured

from

private

sources/banks/financial

will not be eligible for an advance from the Bank for repayment thereof. The

advance, if required, should be availed of before purchase of the vehicle.

3. In case of purchase of a pre-owned motor car, the market value of the car is to be
ascertained from any of the offices of the four subsidiaries of the General Insurance
Corporation

of India viz., Oriental Fire and General Insurance Co. Ltd., New India

Assurance Co. Ltd., United India Insurance Co. Ltd. or National Insurance Co. Ltd. or
Automobile Association of India or the licensed surveyors or Govt. approved valuers /
assessors. While applying for the loan a letter / certificate of valuation from any of the

above agencies will have to be uploaded by the officer / employee concerned in

Samadhan. The Bank will not provide advance for purchase of pre-owned Motorcycle /
Scooter.
4. Advance will also be available for purchase of a pre-owned motor car from a company
authorized re-seller, dealing in resale of used cars. In such cases advance may be
granted without insisting on the car being actually registered in the name of the selling
company/dealer.

However, the applicant would have to submit a declaration while

submitting loan application in Samadhan to the effect that he / she would

a) get the existing entry of hypothecation recorded in the certificate of registration

duly cancelled.
b) take necessary steps for recording the hypothecation entry in the name of the
Bank; and
c) secure physical possession of the said motor car.
d) Include Bank's lien in the insurance policy obtained for the car.
5. In cases where advance payment is required to be made to the manufacturer

or

company's authorised dealer as a pre-condition for booking of the car, the officer/Class
III/Class IV employee will make the payment on his / her own and upload the receipt in
Samadhan while applying for the advance. The Bank, while disbursing the loan will credit
the amount of advance paid in employee's account. The remaining portion of the eligible
amount would be credited to dealer's account.
6. No advance

can be granted

for purchase

of vehicles

from

close

relatives

like

father/mother, brother/sister, son/daughter, wife/husband, etc.

7. At the time of applying for the advance, the officer/employee will be required to furnish an
undertaking that on completing the purchase, he/she will submit scanned image of all
required documents in Samadhan. Further, he/she would also provide a declaration that
he/she would submit the original documents as and when demanded.
~. The insurance premium for the first year will not be included while calculating the cost of
car for grant of advance. The insurance premium for the first year will be reimbursed to
the employee based on claim made by him / her.
9. The car / motorcycle / scooter purchased with the Personal Advance shall be insured
comprehensively against full loss by fire, theft or accident for the first year from the date of
purchase. Insurance on 'owner driven' or other similar qualifying terms is not sufficient for
this purpose. From the second year onwards the vehicles will be insured under the Group
Motor Vehicle Insurance Policy of the Bank. Officers and workmen staff should upload
the

documents

in

terms

of

the

instructions

CO.HRMD.No.G.134/117743/17.06.00/2014-15
CO.HRMD.No.G.145/22021/17.06.00/2015-16

dated

contained
April

in

our

24,

circulars

2015

and

dated April 18, 2016 respectively. The

officer / employee will ensure that Bank's lien is noted in the insurance policy.

3
10. A fresh advance may be granted to an officer/ employee without insisting on the sale of
vehicle purchased with the first advance. However, in order to become eligible for the
second advance, he/she should repay the first advance together with interest thereon and
no advance may be granted before the expiry of four years from the date of drawal of first
advance for purchase of Motor Vehicle.
11.

When an officer/employee wishes to sell a vehicle purchased with the Bank's advance
within a period of four years and utilize the sale proceeds for purchase of another new
vehicle, even if no fresh advance is required for purchasing the second vehicle, he / she
will neither be eligible for a fresh advance nor will he/she be permitted to utilize the sale
proceeds for purchase of another vehicle (new or old) unless a period of four years has
elapsed from the date of drawal of the previous advance for purchase of Motor vehicle.

12.

An officer/Class III employee who has availed of advance for purchase of two wheeler and
desires to purchase a four wheeler or has availed advance to purchase a four wheeler
and desires to purchase a two wheeler may be allowed a fresh advance. The quantum of
fresh advance will be restricted to the difference between entitled limit for motor vehicle
advance and the Motor Vehicle advance availed earlier.

13.

In case for any reason he/she is unable to purchase the said Motor vehicle the amount of
advance should be refunded forthwith. If he/she does not refund the full amount of the
advance and interest thereon within the aforesaid period, he/she shall be liable to pay,
penal interest of 5% above the rate at which the advance was sanctioned.

In such cases,

interest at the normal rate is chargeable for one calendar month and extension thereof, if
any, allowed by the sanctioning authority. For defaults beyond the above period, penal
interest will be recoverable for the amount of advance and interest thereon as on the date
of default.
14.

An advance sanctioned for the purchase of Motor vehicle is valid for six months from the
date of sanction. A sanction not utilized within the prescribed period will lapse.

15.

An officer/Class

III employee applying for advance for purchase of second hand car

should be advised to produce the relative registration book issued by the Regional
Transport

authorities.

The particulars

mentioned

in the registration

book such as

registration number, name and address of the owner as also his/her signature should be

verified with reference to the information/particulars

advance and sale agreement.

***************

furnished

in the application for

Annex II

Additional Terms and Conditions for Personal Advance applied for Education of children:
1. The Personal Advance for the purpose of education of children is available to meet the

expenses towards tuition fee, caution money deposit for library / laboratory and similar
other direct payments to the college /Institution. The loan may also be granted to cover all
expenses incurred directly in connection with education of the ward subject to production
of satisfactory documentary evidence. An employee may also be allowed to avail of loan
under the scheme if the fees in respect of the first academic year/semester, as the case
may be, has already been paid from his own resources, provided the loan is applied for
within a period of one month from the date of such payment. This relaxation is applicable
only in respect of the payments made at the time of admission to the first year/semester of
the course.
2. Personal Advance may also be granted to enable employees to repay the education loan
obtained from scheduled banks subject to the following conditions:
a. Personal Advance will be sanctioned for the purpose of repayment of education
loan obtained only from scheduled banks.
b. The amount of Personal Advance to be sanctioned will be restricted to the extent
of the outstanding balance of the principal amount of the loan excluding the
accrued interest thereon.
c. Disbursement of the loan will be made directly to the scheduled bank concerned.
d. The employee

will have to produce a confirmation/consent

letter from the

scheduled bank indicating outstanding balance of the principal amount of the

education loan sanctioned by them and accrued interest thereon, separately and
that they will effect pre-mature closure of education loan account standing in the
name of the employee on receipt of the outstanding balance.
3.

Personal Advance for the purpose of education of children may be granted to an

employee if his dependent ward is pursuing studies in a college / institution such as liT,
11M, engineering,

medical college etc. recognized / approved by the Government or

concerned Authorities leading to a degree. The advance may also be granted for pursuing
postgraduate degrees or diploma courses in Management.

6
4. The advance will be granted for courses conducted by institutions
by Central/State

recognized / approved

Government or by the apex Authority in the concerned field (e.g.

University Grants Commission for University Courses, AICTE for technical education
courses, Institution of Chartered Accountants of India for accountancy courses, etc.).
5. Courses for computer software etc. conducted by reputed training institutions like NIIT"
may also be considered eligible for advance. The duration of such programmes should,
however, be at least six months on part-time/full-time basis.
6. The advance will also be available for pursuing graduate, post graduate and diploma
courses other than professional courses.
7. The advance will not be made available if the ward is drawing stipend or honorarium while
pursuing a particular course.

*****************

7
Annex III

Terms and Conditions for Personal Advance

applied for purchase of Personal Computer

(Iaptop/T ablet)
1. The advance will be available for purchase of only new branded or "kit assembled" models
of Personal Computer (PC)/Iaptop/Tablet and not for second-hand ones.
2. The PC/Laptop/Tablet
Employees

must be purchased from an authorised dealer/ established shop.

are also allowed to purchase online PC/Laptops/Tablet

made from the

manufacturing company's online stores/ online e-commerce stores.

3. The employee will have to ensure that the Personal Computer (PC)/Iaptop/Tablet

is

delivered within one month from the date of grant of advance.

4. The Personal Computer (PC)/Iaptop/Tablet may be kept at the normal place of residence
or at a place where his/her dependent family members / parents (dependent and nondependent) / parent in-laws reside.
5. The Personal Computer (PC)/Iaptop/Tablet shall not be used for commercial purpose.
6. The Bank, if it so desires, may arrange for inspection

of the Personal Computer

(PC)/Iaptop/Tablet and the employee concerned shall extend necessary co-operation in

this behalf.

*************

Annex IV

Terms and Conditions for Personal Advance applied for purchasing Consumer Article:
1. There is no restriction on the number of articles which can be purchased at a time.
2. The advance would be granted for purchasing new electronic goods, consumer articles
and furniture.
3. In case of furniture items, employees may get them made by engaging carpenter/so
4. The items may be kept at the normal place of residence or at any place owned by the
employee or at the place where his/her dependent family members / parents (dependent
and non-dependent) / parent in-laws reside.

*************

Annex V

Terms and Conditions for Personal Advance availed for Personal Travel:
1. Travel has to be conducted within one month from the date of grant of advance.
2. The advance can be utilized for the purpose of travel related expenses of self and
dependent family members / parents (dependent and non-dependent) / parent in-laws.
3. Items eligible for granting advance - Expenditure towards purchase of ticket, payment of
hotel bills for stay, food and drinks (non-alcoholic),

expenditure towards sightseeing,

expenditure towards package tour.

4. The supporting documents have to be uploaded within three months of grant of advance.

**********************

10
ANNEX VI
All or any of the documentls,

as applicable,

will have to be uploaded in Samadhan

depending upon the nature of purchase. All the documents will be self attested.

Purpose

At the time of applying

Proof of utilization (within 3

months of withdrawal)

Motor Vehicle

(i)
An undertaking that on
completion
the purchase, the
employee will submit scanned
image of all required documents
in Samadhan.
(ii) A declaration that he would
submit the original documents to
Bank as and when demanded

Receipt from the dealer/seller.

Registration Book issued by RTO
with Bank's lien thereon.

In case of pre-owned motor car

(i) a declaration while submitting
loan application in Samadhan to
the effect that he / she would
(a) get the existing entry of
hypothecation
recorded in the
certificate
of registration duly
cancelled.
(b) take necessary steps for
recording the hypothecation entry
in the name of the Bank; and
(c) secure physical possession of
the said motor car.
(d) Include Bank's lien in the
insurance policy obtained for the
car.
Education

(i)
An undertaking that on
completion the purchase, the
employee will submit scanned
image of all required documents
in Samadhan.
(ii) A declaration that he would
submit the original documents to
Bank as and when demanded
(iii) Letter of admission, Fee

Receipts, loan closure

from commercial bank.

advice

../3

11

PC / Laptop /
Tablet

Consumer
Articles

Personal
Travel

demand letter, consent letter from

commercial
bank
(in
case
advance is being applied for
repayment
of education
loan
obtained from commercial banks)
(i)
An undertaking that on
completion
the purchase, the
employee will submit scanned
image of all required documents
in Samadhan.
(ii) A declaration that he would
submit the original documents to
Bank as and when demanded
(iii) Invoice,
In case of purchase through
credit/debit card/online stores
(iv) Invoice/Bill
received from
online store
(v) Credit card statement showing
the bill amount due

(i) Receipts
(ii) valid document
indicating
actual payment made
(iii) Bank A/c statement/Credit
Card
statement
indicating
payment made.

(i)
An undertaking that on
completion the purchase, the
employee will submit scanned
image of all required documents
in Samadhan.
(ii) A declaration that he would
submit the original documents to
Bank as and when demanded
(iii) Invoice,
In case of purchase through
credit/debit card/online stores
(iv) Invoice/Bill received from
online store
(v) Credit card statement showing
the bill amount due

(i) Receipts
(ii) valid document
indicating
actual payment made
(iii) Bank A/c statement/Credit
Card
statement
indicating
payment made.

(i)
An undertaking that on
completion the purchase, the
employee will submit scanned
image of all required documents
in Samadhan.
(ii) A declaration that he would
submit the original documents to

One or more of the following

documents to be submitted:
Rail/Air Tickets/cash receipts or
any other instrument in support of
journey
undertaken,
Boarding
passes (in case of travel by

.,

12
Bank as and when demanded
(iii) Estimate of expenditure to be
incurred.
Invoice (in case of
package tour)

*************

flight), hotel bills and receipts for

stay, receipts for payments made
towards
sightseeing,
package
tour bills or receipts