_{*The above mentioned agreements are for representation purpose and the final agreement may vary. Please read the final agreement before signing.}

_{The final agreement is to be signed in English by the parties to the contract.}

                                                                                                                        INTRODUCTION

The Reserve Bank of India has drafted the guidelines on Fair Practices Code for Non-Banking Finance Companies which sets the fair practices standards that will govern dealings of Finance companies with its customers and to serve as a part of best corporate practice.

This Fair Practices Code is aimed to provide to the customers effective overview of Practices, which will be followed by the Volkswagen Finance Private Limited (Company / We), in respect of the financial products and services offered by the Company to its customers. The Code will facilitate the customers to take informed decisions in respect of the financial products and services to be availed by them and will apply to any loan that the Company may sanction and disburse.

1.0 Objective of the Code

Primary objectives behind development of this code are:

(A) Promote good, fair and trustworthy practices in dealing with the customers;

(B) Increase transparency to enable the customers to have a better understanding of what they can reasonably expect of the services.

(C) Encourage market forces, through competition, to achieve higher operating standards;

(D) Promote a fair and cordial relationship between the customers and the Company.

2.0 Our Key Commitments and Declarations

2.1 We shall act efficiently, fairly and diligently in our dealings with all our customers by:

(A) Meeting the commitments and standards of this Fair Practices Code for the financial products and services, we offer, and the procedures and practices our staff follows;

(B) Ensuring that all the financial services meet relevant laws and regulations;

(C) Providing professional, courteous and speedy services;

(D) Providing accurate and timely disclosure of terms and conditions, costs, rights and liabilities as regards financial transactions.

(E) Its dealings with its customers will rest on ethical principles of honesty, integrity and transparency.

2.2 We shall help the customer understand how our financial products and services work by:

(A) Giving verbal information about the financial schemes in Hindi and/or English and/or local vernacular language;

(B) Ensuring that our advertising & promotional literature is clear and is not misleading;

(C) Explaining financial implications of the transactions;

(D) Helping the customer to choose the financial scheme.

2.3 We shall deal quickly and proactively with things that goes wrong, by:

(A) Correcting mistakes;

(B) Attending customer complaints;

(C) Informing; our customers how to take their complaint forward if the customers are not satisfied with our initial assistance;

(D) Reversing any charges wrongly applied to a customer’s account due to an error on our part.

3.0 Sales Origination

The Company will guide its customers in choosing products and services which meets his / her requirements.

a.Before the customer relationship is established, the Company will:

• Give the customer information explaining the key features of the services and products the customer has shown interest in.

• Give information on accounts, products and services which will suit the customer’s needs.

• Clearly state the information that the Company requires to collect from the customer to fulfill its ‘Know Your Customer’ norms and to comply with legal and regulatory requirements in force from time to time.

• Request for additional information about the customer and his /her family to build a database; but this information will be furnished by the customer only if she / he wish to do so.

b.The Company will provide information on the various channels that can be used to access its products and services. The customer will also be informed on where further information on this is available.

c.Once a customer has chosen a product, the Company will tell the customer how it works.

d.The Company will guide its customer on rights and responsibilities specific to the mode of operation under  which the product is taken.

4.0 Non-Discrimination Policy

We will not discriminate between our customers on the basis of their gender, race or religion. Our policy is to treat all the clients consistently and fairly. Our employees will offer assistance, information and service in a fair, equitable and consistent manner. We will also communicate our Fair Practices Code to our customers by placing it on the company’s website.

5.0 Applications for loans and their processing:

(A) Loan application forms issued by the Company shall include necessary information, which affects the interest of the borrower so that he/she can do a meaningful comparison with the terms and conditions offered by other NBFCs and an informed decision can be taken by the borrower. The loan application form will indicate the documents required to be submitted along with the application form.

(B)The Company shall issue an acknowledgement receipt for all loan applications.

(C) Loan applications shall be disposed of within minimum period of 15 days or such extended time as may be mutually agreed between the customers and the Company, from the date of receipt of the application form along with complete set of required supportive documents.

(D) If any additional details/ documents are required, the same shall be intimated to the borrowers immediately.

6.0 Loan appraisal and terms/conditions:

(A)The Company shall conduct a due diligence on the credit worthiness of the borrower, which will be an important parameter for taking decision on processing of the application. The assessment would be in line with the Company’s credit policies, norms and procedures in respect thereof.

(B) The borrower would be informed by means of a written sanction letter of the amount of loan sanctioned or otherwise. The sanction letter shall contain gist of the terms and conditions including the annualized rate of interest and the method of application thereof.

(C) The Company shall obtain an acceptance from the borrower on the said sanction letter with the borrowers’ signature.

(D) The Company shall invariably be bound to furnish a copy of the loan agreement along with a copy of all enclosures quoted in the loan agreement to all the borrowers at the time of disbursement of loans.

(E) The acceptance of the terms and conditions communicated by the borrower shall be preserved by the Company in its records.

7.0 Disbursement of loans including changes in terms and conditions:

(A)The Company shall frame appropriate internal principles and procedures for determining and ensuring that the interest rates and processing and other charges are not excessive. The Company shall, at the time of disbursal, ensure that the interest rate and processing and other charges on loan and advances are in strict adherence to above referred internal principles and procedures.

(B) The disbursement will be done immediately upon compliance of all the terms and conditions of the sanction by the borrower.

(C)The Company shall give a notice to the borrower of any change in the terms and conditions including disbursement schedule, interest rates, service charges, prepayment charges etc. The Company shall also ensure that changes in interest rates and charges are effected only prospectively.

8.0 Post Disbursal Supervision:

(A) Any decision to recall/accelerate payment or performance under the loan agreement shall be in consonance with the Loan Agreement.

(B) All securities offered by the borrower shall be released on repayment of all dues or on realization of the outstanding amount of loan subject to any legitimate right or lien for any other claim the Company may have against the 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 the Company is entitled to retain the securities till the relevant claim is settled/paid.

9.0 Interest Charged:

(A) The Company had laid down appropriate internal principles and procedures in determining interest rates and processing and other charges

(B) The Company would adopt an interest rate model taking into account relevant factors such as, cost of funds, margin and risk premium, etc. and determine the rate of interest to be charged for loans and advances. Besides disclosing the approach towards risk and rationale for charging different interest to different categories of borrowers, the Company would also communicate the same explicitly in the sanction letter

10.0 Repossession

(A) The Company will make a re-possession clause in the contract/loan agreement with the borrower that would be legally enforceable. To ensure transparency, the terms and conditions of the contract/loan agreement will include provisions regarding:

(a) notice period before taking possession;

(b) circumstances under which the notice period can be waived;

(c) the procedure for taking possession of the security;

(d) a provision regarding final chance to be given to the borrower for repayment of loan before the sale / auction of the property;

(e) the procedure for giving repossession to the borrower and

(f) the procedure for sale / auction of the property.

11.0 General

(A) The Company shall not interfere in the affairs of the borrower except for the purposes provided in the Loan Agreement unless new information not earlier disclosed by the borrower has come to the notice of the Company.

(B) The Company will call delinquent customers between 0800 hrs. to 2000 hrs. unless special circumstances of the borrower’s business require to call them otherwise outside the hours mentioned.

(C)The Company may arrange for enforcing security charged to it of the delinquent borrower, if required, with an aim only to recover dues, cost and expenses of such enforcement action.

(D) The Company shall ensure that the entire process of enforcing its security, valuation and realisation thereof be fair and transparent.

(E), In the matter of recovery of loans, the Company shall resort only to remedies which are legally and legitimately available to it and will avoid using recovery measures during odd hours of the day, undue harassment, use of muscle power for recovery of loans. As complaints from customers also include rude behavior from the staff of the companies, the Company shall ensure that the staff are adequately trained to deal with the customers in an appropriate manner.

(F) In case of receipt of a request from the borrower for transfer of the borrower account, the consent or otherwise i.e. objection of the Company, if any, shall be conveyed within 21 days from the date of receipt of such request. Such transfer shall be as per transparent contractual terms in consonance with law.

(G) In case of receipt of a request from the borrower for transfer of the borrower account, the consent or otherwise i.e. objection of the Company, if any, shall be conveyed within 21 days from the date of receipt of such request. Such transfer shall be as per transparent contractual terms in consonance with law.

12.0 Terms and Conditions

(A) When a customer accepts a product or service for the first time, we will provide the customer with the Rules and Regulations that are relevant to the product / service.

(B) All Terms and Conditions will be fair and will set the customer’s rights and responsibilities clearly and in plain language. We will use legal or technical language only where necessary.

( C) If the Company increases any charges or introduces a new charge, The Company will notify the same to the customers.

(D) The Company will provide the terms and conditions in respect of any product or service whenever a customer requests for the same.

13.0 Complaint/ Grievance Redressal Mechanism

(A) Customers can register complaint on our dedicated email ID: CustomerCare.India@vwfs.com.

(B) The Company shall appoint Grievance Redressal Officer who will examine the matter and respond to complaints as soon as possible.

(C) The Company shall display the following information prominently, for the benefit of its customers, at all its branches / places where business is transacted:

• The name and contact details (Telephone / Mobile nos. as also email address) of the Grievance Redressal Officer
• Contact details of Officer-in-Charge of the Regional Office of DNBS of RBI, under whose jurisdiction the registered office of the Company falls in the event of complaint / dispute remains unresolved for a period of one month
  
• If the complaint / dispute is not redressed within a period of one month, the customer may appeal to the Officer –in -Charge of the Regional Office of DNBS of RBI (complete contact details), under whose jurisdiction the registered office of the Company falls i.e. Mumbai Regional Office

(D) Duties of GRO

1. After receiving customers’ complaint through e-mail id - CustomerCare.India@vwfs.com or written letters, GRO will examine the matter and respond to complaints within 30 days from the date of receipt of such complaint.

2. If customer is not satisfied with the responses, then the Officer will provide guidance to such customer on escalation mechanism.

3. GRO will submit the Grievances Redressal report to management within 15 days from the end of each quarter.

14.0 Review

A periodical review of the Fair Practices Code and the functioning of the grievances Redressal mechanism at various levels of management would be undertaken by the Company.