Awaiting your valuable suggestions on the issue faced in our organisation. We are a non =profit organisation with the strength of 100 employees. we follow to give interest free loans to our employees to manage their emergency financial needs.But recently, we came to know that, many of our employees are getting this loan telling fake reasons and loaning for interest upto 10% interest to our internal employees itself.
As we need to have a system that really helps the needy people .Kindly share your valuable advice and suggestion on this.
From India, Madras
4As we need to have a system that really helps the needy people .Kindly share your valuable advice and suggestion on this.
From India, Madras
Dear JayArani J,
The most important sentence of your post is "But recently, we came to know that, many of our employees are getting this loan telling fake reasons and it turn loaning for interest upto 10% interest to our internal employees itself."
Now you have two options. One is to stop the loan facility completely. However, this is as good as throwing baby with the bath water. The second option is to improvise the verification process. Somewhere you appear to be lax while disbursing the loan to the employees. Hereafter, ask for the documentary evidence before issue of the loan to the employee. This will help you in segregation of the genuine recipients and fake ones. Secondly, howsoever the reason genuine may be, introduce some time period between the payment of the last instalment of previous loan and the first instalment of the next loan. It could be anything between three to five years.
Thanks,
Dinesh Divekar
From India, Bangalore
The most important sentence of your post is "But recently, we came to know that, many of our employees are getting this loan telling fake reasons and it turn loaning for interest upto 10% interest to our internal employees itself."
Now you have two options. One is to stop the loan facility completely. However, this is as good as throwing baby with the bath water. The second option is to improvise the verification process. Somewhere you appear to be lax while disbursing the loan to the employees. Hereafter, ask for the documentary evidence before issue of the loan to the employee. This will help you in segregation of the genuine recipients and fake ones. Secondly, howsoever the reason genuine may be, introduce some time period between the payment of the last instalment of previous loan and the first instalment of the next loan. It could be anything between three to five years.
Thanks,
Dinesh Divekar
From India, Bangalore
Apart from what Learned member Shri Dinesh has suggested, I would add:
Make a set of rules for loans, purposes for which loan can be given and number of times it can be given to employees.
Publish a clear rule that borrowing and lending of between employees is prohibited as a company policy decision.
Verification of purpose of loan and even direct payment of loan to School/college/hospital etc if loans are claimed for such purposes.
From India, Pune
Make a set of rules for loans, purposes for which loan can be given and number of times it can be given to employees.
Publish a clear rule that borrowing and lending of between employees is prohibited as a company policy decision.
Verification of purpose of loan and even direct payment of loan to School/college/hospital etc if loans are claimed for such purposes.
From India, Pune
Dear Friends,
Importantly there should be a clause / rule in loan policy stating that anyone found misusing the loan amount taken or using this loan amount for some different purpose will be dealt with seriously.
.................................................. .....
From India, Mumbai
Importantly there should be a clause / rule in loan policy stating that anyone found misusing the loan amount taken or using this loan amount for some different purpose will be dealt with seriously.
.................................................. .....
From India, Mumbai
Dear JayArani J,
Mr Nathrao has written that "direct payment of loan to School/college/hospital etc if loans are claimed for such purposes."
This is an excellent suggestion. When the direct payment is made, automatically it will curb misuse of the loan facility.
Secondly, Mr KA Korgaonkar has given suggestion that "anyone found misusing the loan amount taken or using this loan amount for some different purpose will be dealt with seriously."
This is also a very good suggestion. When employee takes a loan and if you obtain declaration to this effect from the employee, it will act as deterrent.
Thanks,
Dinesh Divekar
From India, Bangalore
Mr Nathrao has written that "direct payment of loan to School/college/hospital etc if loans are claimed for such purposes."
This is an excellent suggestion. When the direct payment is made, automatically it will curb misuse of the loan facility.
Secondly, Mr KA Korgaonkar has given suggestion that "anyone found misusing the loan amount taken or using this loan amount for some different purpose will be dealt with seriously."
This is also a very good suggestion. When employee takes a loan and if you obtain declaration to this effect from the employee, it will act as deterrent.
Thanks,
Dinesh Divekar
From India, Bangalore
Find answers from people who have previously dealt with business and work issues similar to yours - Please Register and Log In to CiteHR and post your query.
Employee Provisions Regarding Loans & Sattlements.doc