I sent the following complaint about Federal bank and awaiting a response.
(QUOTE)In Federal bank, there is no fee for converting a base rate linked housing loan to
MCLR based loan. As per bank’s website, there is no such fee.There is a fee of 0.25% of the outstanding balance for converting a fixed rate
interest loan to floating rate interest loan. This is evident from the email of the
Customer Relationships Officer of the bank, attached herewith.
However, since the introduction of MCLR based interest rates, the bank has
unilaterally considered all the erstwhile base rate linked loans as fixed rate loans
and stopped to review base rate periodically, violating RBI circulars. This is evident
from the bank’s website https://federalbank.co.in/loan-rate, as per which the bank has only two kinds of loans, one with fixed rate of interest and the other with MCLR bearing interest rate.
And, the Branch Manager of Federal bank* branch considered the base rate
linked housing loans, * and*, I have availed, as
fixed interest rate loans and unilaterally imposed a fee of 0.25% of the outstanding
balance for converting these loans to MCLR based.
There is no transparency as regards this switching fee for conversion of base rate
linked loans to MCLR based.This switching fee is a hidden charge. The bank has
violated it’s code of commitment to customers(UNQUOTE)