RORS FINANCE PRIVATE LIMITED
ANTI SEXUAL HARASSMENT POLICY

Background

RORS Finance Private Limited is committed to creating and ensuring an enabling, dignified and equitable work environment for every employee. Sexual harassment is an act of power, and a public violation of a woman’s dignity that is often trivialized by labeling it an interpersonal transgression. The Supreme Court of India has laid out that it is the duty of the employer or other responsible persons in work places or other institutions to prevent or deter the commission of acts of sexual harassment and to provide the procedure for the resolution, settlement or prosecution of acts of sexual harassment by taking all steps required. RORS Finance Private Limited endeavors to put in place adequate measures to ensure safety, security, dignity, rights and equality of women.

Sexual Harassment: The Law

The Supreme Court in India has mandatory guidelines known as Vishakha Guidelines, for resolution and prevention of sexual harassment enjoining employers by holding them responsible for providing a safe work environment for women. Vishakha guidelines apply to both organized and unorganized work sectors and to all women whether working part time, on contract or in voluntary/honorary capacity. The guidelines are a broad framework which put a lot of emphasis on prevention and within which all appropriate preventive measures can be adapted. One very important preventive measure is to adopt a policy which expressly prohibits sexual harassment at work place and provides effective grievance procedure, which has provisions clearly laid down for prevention and for training the personnel at all levels of employment. The directions were deemed to be “binding and enforceable in law.”

Purpose

• RORS Finance Private Limited has promulgated its Policy against Sexual Harassment which will be implemented across all offices of RORS Finance Private Limited, and other places where employees find themselves in connection with work.
• The purpose of the policy is to promote a work place free from sexual harassment, prevent and minimize harassment of sexual nature, and provide an appropriate complaint mechanism to redress the complaints and ensure time bound redressal.
• Specifically this policy aims: To put in place a mechanism for prevention and redressal of sexual harassment cases at work place.
• To create a secure and stress free environment for women workers/ employees
• To ensure that no gender based discrimination takes places which hinders women’s progress and equal opportunities for them
• To promote a healthy work environment in which men and women can work as a colleagues and develop their fuller potential

Principles

• Sexual Harassment is unlawful and will not be tolerated and is a disciplinary issue the principles governing it are:
• Speedy (early) resolution to problems
• Confidentiality
• It is the duty of all staff, part time or casual employees, volunteers and consultants to comply with this policy.
• Any retaliation against an individual who has complained about sexual harassment (complainant) or retaliation against individuals for cooperating with an investigation of a harassment complaint is similarly unlawful and will not be tolerated.
• Managers have a duty to ensure that all staff knows that harassment will not be tolerated
• Managers have a responsibility to take appropriate action where they become aware of possible harassment
• Misuse of policy or Malicious complaints will be dealt with as a disciplinary matter

Policy

• This policy shall extend to all Staff of RORS Finance Private Limited and to third party harassment of RORS Finance Private Limited women employees. Specifically, the provisions of this policy are applicable to
• All women employees of RORS Finance Private Limited,
• Action under this policy will be initiated in cases where any of the above is subjected to sexual harassment by RORS Finance Private Limited employee, inside or outside the office.
• The policy is not designed or intended to limit RORS Finance Private Limited’s authority to discipline or take remedial action for workplace conduct which we deem unacceptable, regardless of whether that conduct satisfies the definition of sexual harassment. RORS Finance Private Limited will actively assist and do all that is necessary to ensure the safety of female staff in the office premises or otherwise in respect to any duties/activities that they perform in connection with work which take place outside office premises and involves third party contacts.
• In cases where a RORS Finance Private Limited employee is subjected to sexual harassment by a third party who is not an RORS Finance Private Limited employee, this policy mandates immediate action to protect the complainant and to initiate action against the harasser, either through the appropriate policy of the concerned employer or, in cases where this is not possible, through the criminal justice system.

Examples of behavior include:

• Unwelcome sexual advances – whether they involve physical touching or not;
• Sexual epithets, jokes, written or oral references to sexual conduct, gossip regarding one’s sex life; comment on an individual’s body, comment about an individual’s sexual activity, deficiencies, or prowess; banter, insults, taunts or gibes which are disparaging about a particular gender or make reference to sexuality or intimate parts of the body
• Displaying pornographic or sexually suggestive objects, pictures, cartoons;
• Unwelcome leering, whistling, brushing against the body, sexual gestures, suggestive or insulting comments;
• Inquiries into one’s sexual experiences; and,
• Sexually oriented comments and use of abusive language in the presence of women or any other foul language which shows disrespect towards women;
• Discussion of one’s sexual activities.
• Persistent or unwanted attention or physical contact or similar;
• The exercise of undue influence to obtain consent to a sexual relationship;
• The general use of sexually explicit or provocative language;
• Obscene behavior in front of women colleagues; seeing or compelling them to see photographs which make them feel harassed;
• Any behavior that creates an environment that is intimidating, hostile, or offensive for members of one sex, and thus interferes with a person’s ability to work;
• The above is not exhaustive and can only be used as a guide for examples of sexual harassment.
• All staff should take special note that, as stated above, retaliation against an individual who has complained about sexual harassment, and retaliation against individuals for cooperating with an investigation of a sexual harassment complaint is unlawful and will be treated as gross indiscipline.

Preventive Action

• Consistent with the existing law under the Vishaka judgement, RORS Finance Private Limited shall take all reasonable steps to ensure prevention of sexual harassment at work. Such steps shall include:
• Prominently notifying the VISHAKA guidelines (and appropriate legislation when enacted on the subject) in suitable manner
• Commitment to enforce the policy and circulation of RORS Finance Private Limited’s policy on sexual harassment to all staff, partners or others (Volunteers, Consultants, interns, service providers) in any way acting in connection with the work and/or functioning of RORS Finance Private Limited
• Informing all others (partners, service providers etc) who are connected to the works of RORS Finance Private Limited, to make them aware of the policy and violation of the principles laid in the policy, may lead to the termination of the contractual or other relationship with such agency/individual
• Ensuring a reference to the policy and its enforceability in all contracts and agreements signed by RORS Finance Private Limited
• Ensuring that all employees are aware of what is meant by harassment and the rights of the affected person, and the consequences on the harasser;
• Educate all employees about the issue and promote a healthy discussion of the policy. Arrange trainings on sexual harassment and addressing complaints to staff as well as members of the Committee against Sexual Harassment (CASH) empowering them to execute their roles through informed and objective decisions
• All persons will be strongly encouraged to immediately report any evidence of discriminatory harassment or complaints regarding discriminatory harassment made to them to the Senior Management or members of the CASH Committee.
• Taking care of the safety and protection of women staff while planning for travel, visits to ensure that their exposure to risks of sexual harassment is minimized

Committee against Sexual Harassment

The Committee against Sexual Harassment set up for this purpose, shall have statutory status and be empowered to carry out the mandate of the policy. The Committee will be empowered to receive complaints, attempt informal resolution through mediation, conduct formal enquiries and recommend appropriate actions for redressal and punishment.

Constitution of the Committee

• The Director of RORS Finance Private Limited Mrs. Revathi Reddy, Chair the committee.
• Mrs. Usha Rani the Chief Accounts Officer as committee member
• Mr. V. Sreenivasulu, Operational Head as committee member

The names and contact details of all members of the Committee shall be prominently displayed on the main notice board of all RORS Finance Private Limited offices.

Duties and Responsibilities of Committee against Sexual Harassment

• It shall be the duty of the, Chief Accounts Officer of the committee as the case may be, who receives such a complaint, to immediately inform the complainant of her right to initiate action in accordance with the policy
• Recognize that confidentiality is important and will respect the confidentiality and privacy of complainants or defendants, to the extent reasonably possible
• If at any stage after the filing of a complaint and during any proceedings in respect of it, the aggrieved staff shall have the right to withdraw the complaint and the Committee against Sexual Harassment shall permit her to withdraw the complaint and if an inquiry has commenced, shall discontinue the inquiry.
• If it is brought to the notice of the Committee against Sexual Harassment is of the opinion that, pressure is being brought on the complainant or the witnesses to withdraw their statements or not go through with the complaint then it will record this.
• Committee against Sexual Harassment shall be empowered to do all things necessary to ensure a fair hearing of the complaint including all things necessary to ensure that complainants/aggrieved persons or witnesses are neither victimized nor discriminated against while dealing with a complaint of sexual harassment. In this regard the Committee against Sexual Harassment shall also have discretion to make appropriate interim recommendations vis-à-vis an accused person pending the outcome of a complaint including suspension. It would:
• Ensure that procedures for registering complaints are simple, accessible and effective.
• Take immediate cognizance of the complaints, conduct timely enquiries, provide redressal to the complainant and take action against the harasser.
• Recommend appropriate follow up action and monitor the compliance
• Seek legal, medical or police assistance with the consent of the victim
• Offer/ensure required psychological, emotional and physical support to the victim.

Complaints of Sexual Harassment

• If any staff at RORS Finance Private Limited believes that she has been subjected to sexual harassment, such person, shall have the option to file a complaint with Committee against Sexual Harassment. This may be done in writing or orally.
• A complaint may be filed by contacting any one of the members of the Committee against Sexual Harassment. Members of Committee against Sexual Harassment will also be available to discuss any concerns staff may have and to provide information about RORS Finance Private Limited’s policy on sexual harassment and the complaint process.

Procedure on handling complaints

• All procedures will be quick and confidential. It will be ensured all members of RORS Finance Private Limited have confidence in the procedures. The proceedings under this policy shall not be stalled or postponed merely because the complainant is proceeding against the accused under any other provision of law. The provisions of this policy shall not restrict the powers of the Management or the complainant to proceed against the alleged harasser for any other misconduct or other legal remedies.
• It is important to take action as early as possible to try to stop the harassment. The Policy offers both Informal and Formal procedures to the aggrieved person to tackle the problem she is facing. She/They may decide not to use the informal procedure and move immediately into the formal procedure. The choice as to which process to use is the aggrieved person(s).

Complainant – Aggrieved person

• Any female staff who feels she is being harassed should read the following procedure and take the action that is considered most appropriate to their circumstances.
• The aggrieved person(s) can contact any member of the Committee against Sexual Harassment who will treat in confidence any discussions with them.
• At all stages it is recommended that the complainant/aggrieved person(s) keep notes of the incidents of harassment that occur, noting time, date, location, people involved, details of what was said and done and the manner in which it was done/said.
• At any stage during the informal and formal stages of the investigation procedure a colleague may accompany the complainant/aggrieved person(s).

Informal Stage

• In the first instance the aggrieved person(s) can try to approach the person who they feel is harassing and ask the person to stop. The aggrieved should explain to the person who is harassing the nature of the behavior that the aggrieved person(s) want to stop and how their behavior makes the aggrieved feel.
• If the aggrieved person(s) do not feel that they can approach the person on their own they might ask someone else to accompany to meet the person(s) allegedly harassing or might wish to ask another person to speak to the alleged harasser on their behalf. They may also want to ask someone to facilitate the discussion with the alleged harasser.
• Talking to someone else before approaching the alleged harasser may help the aggrieved person(s) to think through how best to approach the person involved.
• If judged appropriate, an informal process (discussion with both parties and mediation to resolve the issue) will be attempted within one week of receipt of the complaint.
• In cases where the alleged offender accepts part or all of the substance of the complaint in the course of the informal process, Committee against Sexual Harassment may recommend appropriate disciplinary action.
• In cases where the informal process has been successful in resolving the grievance, the Committee against Sexual Harassment will close the case and submit a report to the SMT recommending measures to prevent the recurrence of the situation that generated the complaint.
• In cases where the informal process reveals prima facie evidence of gross sexual misconduct, the Committee against Sexual Harassment may decide to institute a formal enquiry even if the complainant is satisfied with the informal process.

Formal Procedure

• In cases where an informal approach is deemed inappropriate, or is tried and fails to resolve the issue, a formal investigation will be instituted within fifteen days of the receipt of the original complaint. As has been mentioned above, the complainant/aggrieved person(s) can proceed directly with the formal procedure. The choice of the procedure is with the complainant/aggrieved person(s). If the initial complaint was made verbally, it will be taken in writing at this stage.
• If the aggrieved person(s) decide to use the formal procedure they may contact any one of the duty bearers mentioned above and formally report to the person. The person approached in such a way MUST follow up the case in a way agreed with the individual and in line with this Policy.
• After discussing the case the complainant should put their case in writing. The complainant will be asked to submit a written statement with details of the alleged incident(s) of harassment, with supporting evidence and names of persons who can provide corroboration.
• On receiving the complaint, the duty bearer will report to the Committee against Sexual Harassment of the complaint.

Investigation Procedure

• On receiving a complaint of sexual harassment, the Committee against Sexual Harassment will constitute an investigation panel from its own members or from other RORS Finance Private Limited staff or external experts as appropriate to the complaint received. There will be minimum quorum of 3 members in the investigation panel. The investigation panel shall conduct a detailed inquiry into the complaint by following the process as laid out below.
• The investigation into a complaint will be conducted in such a way as to maintain confidentiality to the extent practicable under the circumstances. In carrying out its investigation the panel should carry out its work in a discrete and sensitive manner and all those involved should treat the matter as strictly confidential.
• In the course of investigating any complaint of harassment, the investigation panel shall ensure that the principles of natural justice are adhered to namely: both parties shall be given reasonable opportunity to be heard along with witnesses and to produce any other relevant documents before the investigating panel; upon completion of the investigation, both parties, to the extent appropriate, will be informed of the results of that investigation.
• The alleged offender will be informed in writing of the substance of the complaint. Depending on the nature of the complaint and the particular circumstances of the case, the alleged offender will be requested to respond either in writing or orally to the investigation panel, which will record the response.
• The alleged offender will also be asked to submit documentary or other evidence in refutation of the complaint.
• In the course of investigating the complaint, investigation panel will conduct personal interviews with the complainant, the alleged offender and any other individuals who can provide information in support of, or in refutation of, the complaint. The complainant and the defendant shall be called separately to ensure freedom of expression and an atmosphere free of intimidation. The complainant shall be entitled to be accompanied by one representative during the enquiry.
• The investigation panel may also examine documents, including confidential files and records pertinent to the case.
• The proceedings of the investigation and the deliberations of the Committee against Sexual Harassment will be recorded both in writing and on tape.
• The complainant (or a person nominated by the complainant as an observer) will have the right to remain present during the depositions by the alleged offender and witnesses. Transcripts of the depositions may be made available in cases where the complainant chooses not to exercise the right to be present.
• In extreme circumstances it may be appropriate to suspend the alleged harasser (without blame) on full pay pending the outcome of the investigation.
• Recommendation by the majority members of the investigations panel will be accepted as the recommendation of the panel, but the panel will record dissent and differences if any.

Recommendation and Action

• • At the close of the investigation, the Committee against Sexual Harassment will submit a report in writing, stating its findings and recommending the appropriate course of action. Recommendations made by Committee against Sexual Harassment shall be final and binding on the Management of RORS Finance Private Limited.
  • RORS Finance Private Limited views any finding of harassment a serious violation of human rights; if it is determined that inappropriate conduct has been committed by a staff, appropriate action will follow under the circumstances. Such action may range from counseling to termination from employment, and may include such other forms of disciplinary action as the Committee against Sexual Harassment deems appropriate under the circumstances and makes a written recommendation. RORS Finance Private Limited Management will be responsible to initiate action to stop the harassment and prevent its reoccurrence. Committee against Sexual Harassment will be responsible for ensuring that the recommendations are followed up.
  • After completing the investigation, where a person(s) is found to have sexually harassed another person(s) Committee against Sexual Harassment should make clear recommendations as to necessary action to be instituted to remove the offensive conduct and where appropriate, for disciplinary proceedings to be taken against the harasser. The complainant’s views shall be taken into consideration for this purpose. The complainant will have the option to seek transfer of the offender or their own transfer.
  • On the completion of an enquiry by an investigation panel, it will file its report to the Committee against Sexual Harassment committee. The Committee against Sexual Harassment may recommend to the RORS Finance Private Limited Management actions by a reasoned order and
  • Dismiss the complaint which was the subject-matter of the inquiry; or pass any one or more of the following directions, namely:-

1. That the defendant shall not repeat or continue such unlawful conduct; or
2. That the defendant shall perform any reasonable act or course of conduct to redress any loss or damage suffered by the complainant; or
3. That the defendant shall give a written apology to the aggrieved woman clearly undertaking that such behavior will not be repeated and that no retaliatory steps will be taken by him or on his behalf; or
4. Tthat a punishment in addition to above be imposed upon the defendant, where the defendant is an employee, according to the gravity of the act of which he has been found guilty
5. The Committee against Sexual Harassment may direct that, any of the following punishments, having regard to the gravity of the act of which he has been found guilty, be imposed on the defendant-

Minor Penalties:

• Being put on Probation for 6 months irrespective of length of service
• Censure/Reprimand in writing to be placed on record in the Personal File

Major Penalties:

• Reduction in salary not exceeding 1/3 of the gross pay
• Forfeiture of Annual Increment
• Suspension from work for a period not exceeding 3 months on half pay
• Transfer
• Dismissal
• Provided further that before any action is taken under this clause, the defendant shall be given an opportunity to show cause as to why the proposed action should not be taken against him.
• Explanation.- For the purpose of this sub-section, “damage” shall include the injury to the feelings of the aggrieved woman or the humiliation suffered by her.

Time Table

• Once the complaint is received at the Committee against Sexual Harassment, a time frame for resolving the complaint should be agreed on receipt of the complaint in writing. In most cases the investigation panel will be set up by the Committee which would complete its investigation within 10 working days. All complaints shall be heard and finally determined within a period of 30 days of the complaint having been made. A report of the case, findings and recommended action (if any) proposed by the Committee shall be completed within his time.

Report

• The investigation panel should prepare a report of its findings and give this to the Committee against Sexual Harassment. The two parties involved will receive copies of the investigation report. There should also be an agreement between the parties as to the level of confidentiality to be maintained about the details of the complaint. Copies of the report and any supporting papers will be kept in a separate confidential file.

Appeal

• Either party may wish to lodge an appeal within 5 days of notification of the outcome of the investigation. This appeal may only be on the grounds of unfairness/fault in the procedure not on grounds of the decision itself.
• In the case of an appeal a new panel will be set up in the same way as the original investigation panel and the grounds for the appeal investigated. At this stage it will probably be appropriate to involve one or more managers in the new panel.

Others

• Where sexual harassment occurs as a result of an act or omission by any third party or outsider, the Committee and RORS Finance Private Limited management will take all steps necessary and reasonable to assist the affected person in terms of support and preventive action.
• Members will be advised and requested to consider adopting suitable measures to ensure that the guidelines laid down by this order are also observed by their organisations.

Management Obligations

• Management of RORS Finance Private Limited shall provide all necessary assistance for the purpose of ensuring full, effective and prompt implementation of this policy. It shall be further be bound by the decisions of the Committee against Sexual Harassment and shall implement the same expeditiously

Criminal Proceedings

• In the event the conduct complained of amounts to a specific offence under the Indian Penal Code or under any other law in existence, the Committee shall recommend to management to take appropriate action in making a complaint with the appropriate authority.
• The Committee will actively assist and do all that is necessary to ensure the safety of a complainant in the office premises or otherwise in respect to any duties/activities perform in connection with her work which take place outside office premises

Conclusion

• The proceedings under this policy shall not be stalled or postponed merely because the complainant is proceeding against the accused under any other provision of law.
• The provisions of this policy shall not restrict the powers of the Management or the complainant to proceed against the alleged offender for any other misconduct or other legal remedies.
• The policy will be reviewed from time to time and revised to keep it up to date with changes in state acts, employments policies or lessons learnt. The process for review will also consult all staff and seek advice externally
• The Committee will minute all its meetings and proceedings and submit quarterly reports to the Governing Board of RORS Finance Private Limited.
• These Reports will be placed before the Board for information at the Board Meeting every quarter.

RORS FINANCE PRIVATE LIMITED
INFORMATION SYSTEM, SECURITY AND DISASTER RECOVERY
MANAGEMENT POLICY

Introduction and policy statement

Information Technology is a key driver of an increasingly knowledge based global economy and is the basis for preparation of this policy. This document sets out the Information Technology (IT) Policy for RORS Finance Private Limited for the protection of its systems and defining baseline responsibilities for IM&T security, equipment and file storage. “IM&T systems” refers to the IT network, hardware including portable media, system and application software, communication components including telephone and WAN systems, documentation, physical environment and other information assets.

his Policy covers the IT networks for staff across all Branches.

The equipment covered by this policy includes:

• Network Infrastructure – The equipment housed internally to provide the IT network, including servers, enclosures, racks, cabling, switches/hubs, Routers, wireless access points, firewalls, proxies, authentication systems and devices, NTEs, ATAs and remote access systems.
• Desktops – Personal Computers (PCs) issued or provided to staff in the course of carrying out their duties
• Laptops/Netbooks – Portable Personal Computers issued or provided to staff in the course of carrying out their duties
• Mobile Phones – Digital communication devices issued or provided to staff in the course of carrying out their duties
• Desk/Conference Phones – Telephones/Voice Communication devices connected to the Network Infrastructure including desk telephones, conference telephones (star phones), analogue telephony adaptors, DECT telephones (cordless)
• Media/Portable Media – Electronic Storage Devices such as DVDs, CDs, memory sticks and hard drives issued or provided to staff in the course of carrying out their duties
• External Communications Infrastructure – Equipment used to connect to the external world including the Wide Area Network, analogue telephone lines, digital telephone lines, leased lines, LES/WES/Ethernet first mile circuits, ADSL circuits, SDSL circuits and all related equipment and services.
• All related Facilities & Estates controlled IT media used in meeting rooms

The objective of this policy is to ensure: –

• the confidentiality of data and information assets are protected against unauthorised disclosure and incidents are promptly reported (see section 9)
• the confidentiality of data and information assets are protected against unauthorised disclosure and incidents are promptly reported (see section 9)
• the availability and accessibility of IT systems as and when required by staff

This policy sets out the principles of IT security including the maintenance, storage and disposal of data and explains how they will be implemented to ensure there is a centralised and consistent approach to IT security.

One of the aims of the policy aims to raise awareness of the importance of IT security in the day to day business of RORS Finance Private Limited.

The policy supports the business objectives of ensuring that the security, integrity and availability of IT systems are balanced against the need for staff to access systems and services that are necessary for their job, within the limits imposed by this policy. It will also help to protect data from misuse and to minimise the impact of service disruption by setting standards and procedures to manage and enforce appropriate IT security.

Scope

• This policy applies to all IT systems of RORS Finance Private Limited and those working at or for RORS Finance Private Limited.

Security

• Technical security measures will be put in place to protect all systems from viruses and other malicious software, and all IT systems will be monitored for potential security breaches.
• All IT equipment, including virtual systems, will be uniquely identified and recorded.
• Environmental controls will be maintained in the server/communications rooms of all premises to protect key equipment. Smoking, drinking and eating is not permitted in these areas.
• Records of all faults and suspected faults will be maintained.
• Access to premise server/communications rooms will only be with the express permission of the IT Department.
• Memory sticks and other portable media must be put to use only after it is verified and found to be free of virus and other malware.
• Strong passwords should be constructed wherever required and not disclosed to anyone who should not have access to it and should be changed from time to time.
• Confidentiality should be maintained towards all data relating to RORS Finance Private Limited and sensitive information should not be disclosed without prior permission from respective department heads.
• All information collected from customers will be guarded with utmost security and privacy of customer data will be respected.
• Employees must use their own username/login code and/or password when accessing the Technology Assets. Guests may be permitted only upon approval by the Information Technology personnel.
• Employees should protect their username/login code and password information at all times and not divulges such information to any other person, unless it is necessary to do so for legitimate business reasons.
• Technology Assets should be logged off when not in use and always when the employee has left the office.

E-mail Etiquette, security and legal considerations

The Internet and E-mail system hardware is Company property and therefore all messages sent or received on the E-mail system are and remain Company property. They are not the private property of any employee/representative.

Occasional use of email and the Internet for personal domestic purposes is allowed on the condition that its use is governed by this policy

Electronic mails are legal documents and can be required to be produced as evidence in legal proceedings. Therefore, care should be exercised never to make any statement which may embarrass you or the company, if made public.

Disaster recovery and business continuity

All business critical data will be replicated

All data will be backed up onto tape libraries weekly once so that data exist in different places. Critical computer equipment must be fitted with battery back-ups (UPS) to ensure that it does not fail during switchovers or emergency shutdowns.

To minimise the risk to IT systems, robust disaster recovery plans will be put in place to ensure:

• identification of critical computer systems
• identification of areas of greatest vulnerability and prioritisation of key users and user areas
• development, documentation and testing of disaster recovery plans, including identifying tasks, agreeing responsibilities and defining priorities
• the existence of emergency procedures covering immediate actions to be taken in response to an incident (e.g. alerting disaster recovery personnel) and actions to be taken to return to full normal service

This policy will be monitored by the IT department to ensure it is fit for purpose and reviewed every year.

RORS FINANCE PRIVATE LIMITED
POLICY ON INVESTMENT

POLICY ON INVESTMENT

Preamble

In terms of the RBI Master circular on “Non-Banking Financial (Non-deposit accepting or holding) companies prudential Norms directions 2007” bearing no. DNBS (PD) CC No.332/03.02.001/2013-14 dated 1st July 2013, every NBFC’s Board of Directors should frame a suitable Investment Policy and execute the same. The guidelines issued by RBI ,inter-alia, state that the criteria to classify the investments into current and long term investments shall be spelt out by the Board of the company in the investment policy. The guidelines also state that investments in securities shall be classified into ‘current and long term’ at the time of making each investment. The circular inter-alia defines “Current Investment” as an investment which is by its nature readily realizable and is intended to be held for not more than one year from the date on which such investment is made. As a NBFC-MFI, active in the field of microfinance, RORS Finance Private Limited is dealing with own as well as borrowed funds. While raising resources and deploying it in the form of lending shall be one in a prudent manner, there may be occasions when the company may have investible surpluses. It would be imperative that such amounts are invested judiciously in suitable instruments that ensure safety of principal and a high degree of liquidity, at the same time giving a fair yield. This Policy, therefore, is intended to act as guidance for the company while making such investments.

Objective of the Policy

The objective of the policy can be broadly summarized as follows:
a) Manage and invest surplus funds efficiently and effectively with the specific intention of deriving optimum returns and manage risks involved thereto.
b) Manage and contain interest rate and market risk.
c) Contain credit risk and protect the capital from erosion.

The Policy

A. General Principles:

1. It shall be ensured that the investments made are safe and there will be no chance of the principal getting eroded.
2. The investment should be easily saleable and convertible to cash, without loss of principal, in case of urgency.
3. The investment shall be well distributed to avoid concentration risk. The Company shall be guided by the Policy on Single Party Exposure adopted by the Board.

B. Permitted investment vehicles

1. Investments in fixed deposits in scheduled commercial banks.
2. Tradable securities issued by the Central and State governments. (Transactions in Government securities shall be done through CSGL account or demat account. The company shall not undertake any transaction in government security in physical form or through any broker.)
3. Instruments issued by the Companies in the Public sector rated AAA/CARE of P1/CRISIL or equivalent rating by other rating agencies which are readily tradable.
4. Debt market schemes of the mutual funds which qualify the following criteria:
   • 100% Debt fund (Nil exposure to Equity)
   • Overall AMC (Asset Management Company) corpus size of minimum Rs 500 Crores
   • Quality of papers – More than 75% of the portfolio should have equivalent of P1+ or AAA ratings or equivalent
   • No real estate Exposure
5. Commercial paper issued by scheduled commercial banks or corporate debentures with a rating of AAA by CARE or equivalent.

C. Duration of investment and its classification

1. 1. The duration of investment may be decided based on the asset liability pattern. It should be ensured that the asset created out of the investment do not create an asset liability mismatch or
      a liquidity risk. Investments made may be classified as current and long term based on the following criteria.

Duration of Investment Classification

One year and less Current Investments
More than one year Long term investments

1. There shall be no inter-class transfer on ad-hoc basis once an investment has been classified on the above basis.
2. The inter-class transfer, if warranted, shall be effected only at the beginning of each half year, on April 1 or October 1, with the approval of the Board.
3. The investments shall be transferred item-wise, from current to long-term or vice-versa, at book value or market value, whichever is lower.
4. To maintain liquidity, as per the liquidity policy adopted by the Board, the company may, as far as, possible maintain its surplus in liquid assets such as short term Bank Deposits and debt
   3 Market instruments of mutual funds of short term maturity and classified as Current Investments.

Accounting of Investments

The accounting part of the investments is made as per the extant RBI guidelines, by which, income from dividend on units of mutual funds shall be taken into account on cash basis.
Quoted current investments shall be valued at cost or market value whichever is lower. Unquoted investments in the units of mutual funds in the nature of current investments shall be valued at the latest Net Asset Value declared by the mutual fund in respect of each particular scheme.

Report

The Board of Directors shall report the investment portfolio of the Company on a quarterly basis.

Authorization:

The investment authorization under this policy may be exercised severally by Mr. P.Sathyanarayana Reddy,Managing Director or Mrs. Revathi Reddy, Director.

Exceptions

• In exceptional circumstances, Managing Director and Chief Executive Officer may exercise powers beyond the investment limit in approved investment vehicles mentioned in this policy and seek ratification from the Board.
• Margin money/security deposit with the lenders as part of the terms of sanction shall be out of the purview this Policy.
• Investments in equity markets or capital market instruments of mutual funds shall not be attempted by the company due to the inherent market risk involved.

Review

The Board of Directors may review this policy as and when required to bring about changes required as per regulatory changes or business requirements.

RORS FINANCE PRIVATE LIMITED
KYC Policy

KYC documents to be obtained for every microfinance loan from client. We need to collect all KYC documents in A4 size.

All KYC original documents should be verified by the staff and collected such documents (Xerox copies) by authenticating the true copies. Name of the client in software and on all forms should be same as name in KYC document. We should mention the alias name if so along with the name as per KYC.

ID Proof (Mandatory)

1. Adhar Card or any one of the following
2. Election Identity card (Voter Card)
3. PAN Card
4. Driving License
5. Passport
6. Ration Card

Address Proof (Mandatory)

1. Aadhar Card
2. Passport
3. Ration card
4. Election Identity card
5. Driving License
6. Rental Agreement
7. Bank / Post office pass book
8. Residential certificate from Municipality/ Gram panchayath

Own House Proof (optional)

1. Any utility bill such as electricity, Municipal tax receipt, water bill
2. Registration document

RORS Finance Private Limited
CREDIT POLICY

Background

RORS Finance Private Limited credit is one of the most important services rendered by the company to its clients who largely belong to the weaker sections of the society. Further, interest income forms the single largest component of income to the company. Asthecompany focused onMicro credit, there is aneed to provide clearstrategic direction in deployment of Credit. This Credit Policy attempts to provide a broad framework for deployment of credit under the guidelines forwarded by Reserve Bank of India from time to time.

Microfinance Loans

A minimum of 75% of the total assets will be maintained in the form of microfinance loans disbursed to the borrowers who fulfil the norms and eligibility criteria of the qualifying assets set by the RBI. Aggregate amount of loan given for income generation activity (IGA), is not less than 50% of the total loan given by the MFIs. The remaining 25% of the assets will be deployed in secured and more profitable loan schemes as decided and approved by the Board from time to time.

A. LOANS UNDER MICROFINANCE SCHEME:

Formation of Women JLG/ Individual Loans

• RFPL follows a hybrid model of Joint Liability Group and Individuals. A JLG consists of 3-5 customers and whose family (client, spouse and earning children) income is not more than 3 Lakhs.
• A detailed individual family survey will be conducted to ascertain their family background, occupation, duration of their stay in the area, weekly-assured income levels, neighbourhood opinion etc.,
• Residential proof of their stay in the locality will be ascertained with documentary evidences like Election cards, ration card, Rent agreements, Electricity bill etc.,
• Initially for 3 weeks all the details of the scheme will be explained to the member and her spouse.
• The members will submit a request to the RFPL to provide them the loan indicating their acceptance to the terms and conditions of the scheme.
• Loan disbursement and collections happen at group level on a mutually accepted date & time.

Eligibility criteria

• Individuals or Active members of the Women JLG Groups are eligible to avail loans underthe microfinance scheme.
• Loanswill be sanctioned normally to women members belonging to the economically backward sections of the society.
• The family income of the member borrower should not exceed Rs.3, 00,000/-. eligible to avail loans from RORS Finance Pvt ltd under microfinance scheme.
• The company’s loans to the borrower’s are not backed by any collateral.
• The company’s loan is repayable by weekly/fortnightly/monthly as per the borrower’s choice.
• The borrower must be married or should have crossed the marriageable age.
• The borrower should be within the age group of 18 to 60 years.
• The borrower should be engaged in income generation activity and supporting their family.
• Borrowers within the group should not be related to each other and there cannot be more than 2 relatives of the member in the same centre.
• The proposed borrower should not be a defaulter in another MFI/Bank/co-operative society
• The borrower should have sufficient repayment capacity to service her debts as evidenced by family income

The Process

• A member can have Income Generation Loan (IGL) / sanctioned under the microfinance scheme.
• 3 to 5 women households will become one micro-financing group belonging to same street (J.L.G).
• A detailed individual family survey will be conducted to ascertain their family background, occupation, duration of their stay in the area, weekly-assured income levels, neighbourhood opinion etc.,
• Residential proof of their stay in the locality will be ascertained with documentary evidences like Election cards, Aadhaar cards, ration card, Rent agreements, Electricity bill etc.,
• On facilitating the affinity group, the group members will submit a request to the RFPL to provide them the loan indicating their acceptance to the terms and conditions of the scheme.
• All the group members will sign the individual loan agreement.
• Each group will have a name and serial number and all their photos will be affixed in the repayment cards for identification.
• The subsequent loan to member will be considered only after the existing loanis repaid in full or an additional loan can also be provided based on proper approval and their repayment record.
• The loans to members in the Group will be guaranteed mutually by the Group members.
• The data entry and the Credit Bureau check are done at the branch level.
• Vernacular application form provided by the company along with terms and conditions of loan/product.
• The loans will be disbursed either by cash or by cheque.
• Based on principal acceptance the borrower will be intimated in writing about time duration of disbursal or rejection of loan application

Loans products:

Product Name	Loan Amount	Loan Tenure	Instalment Frequency	Rate of Interest	Processing fee
Group Loan	10000/- to 30000/-	One year	Weekly/ fortnightly/monthly	Board approved ROI	Board Approved PF +applicable GST
Individual Loan	30000/- to 200000/-	Two years	Weekly/ fortnightly/monthly	Board approved ROI	Board Approved PF +applicable GST

Amount of the loan

OPERATIONAL MANUAL

1. Introduction

1.1 Purpose

RORS FINANCE PVT LTD Operational Policy and Manual serves to provide guidelines to management and field staff at both the head office and branch offices. This document is intended to strengthen the overall management system of RORS FINANCE PVT LTD and to ensure high quality loan portfolio through the application of standard microfinance practices. It provides operational guidelines to deal with externalagencies – such as financial institutions and clients—as well as for internal reference – RFPL employees and the Management. The policies and procedures mentioned in this document are to be applied at every step of operations. All RFPL employees own responsibility for ensuring that operations are carried out fully in compliance with the policies and procedures laid down in this document. The Internal Audit and Risk Management Department should work closely with the management in dealing with the cases of non-compliance.

1.2 Organization

RFPL is a private microfinance company started in April 2010 in Srinivasapura of Kolar district, Karnataka, India. The mission of the Organization is “to reach the unreached low income communities with financial and business solutions in a socially, economically and environmentally sustainable manner through the efficient use of capital, technology and human resources”. The company is promoted by a seasoned microfinance and development professional.

2. CREDIT POLICY

2.1 Background

RORS Finance Pvt Ltd strives to empower the poor and the marginalized in the society by providing access to financial services with emphasis on economic development, financial discipline and improvement in their living standards.

Financing is one of the most important services rendered by the company to its clients who largely belong to the weaker sections of the society. Further, interest income forms the single largest component of income to the company. From the risk perspective, credit requires the undividedattention and understanding of all concerned. Asa company focused onMicro finance, there isaneed to provide clear direction in deployment of funds, monitoring risk mitigation. This Credit Policy attempts to provide a broad framework for deployment of credit.

2.2 Objective of the Policy

The Credit Policy is designed to give broad direction in achieving organizational goals keeping in mind, the needs of the customers, the regulatory guidelines and the interest of the company.

2.3 Principles

• To help the poor, particularly women, to improve the living standard through small but decisive financial interventions through microcredit.
• Provide Micro credit at the doorstep of the clients.
• Make available collateral-free loans under micro credit
• Relying on social collateral, household survey and through group and individual family monitoring.
• All loans to be repaid with interest in weekly / fortnightly / monthly instalments.
• Continuous engagements with clients and building Social Capital

2.4 Credit Deployment

Microfinance Loans

A minimum of 75% of the total assets will be maintained in the form of micro finance loans disbursed to the borrowers who fulfil the norms and eligibility criteria of the qualifying assets set by the RBI. Aggregate amount of loan given for income generation activity (IGA), is not less than 50% of the total loan given by the MFIs. The remaining 25% of the assets will be deployed in secured and more profitable loan schemes as decided and approved by the Board from time to time.

LOANS UNDER MICRO FINANCE SCHEME:

Formation of Women JLG / Individual Loans

• RFPL follows a hybrid model of Joint Liability Group and Individuals. A JLG consists of 3-5 customers and whose family (client, spouse and un-married earning children) income is not more than 3 Lakhs.
• A detailed individual family survey will be conducted to ascertain their family background, occupation, duration of their stay in the area, weekly-assured income levels, neighbourhood opinion etc.,
• Residential proof of their stay in the locality will be ascertained with documentary evidences like Election cards, ration card, Rent agreements, Electricity bill etc.,
• Initially for 3 weeks all the details of the scheme will be explained to the members and their spouse.
• The members will submit a request to the RFPL to provide them the loan indicating their acceptance to the terms and conditions of the scheme.
• Loan disbursement and collections happen at group level on a mutually accepted date & time.

Eligibility criteria

• Individuals or Active members of the Women JLG Groups are eligible to avail loans under the microfinance scheme.
• Loans will be sanctioned normally to women members belonging to the economically backward sections of the society.
• The family income of the borrower should not exceed Rs.3,00,000/- eligible to avail loans from RORS Finance Pvt Ltd under microfinance scheme.
• The company’s loans to the borrowers are not backed by any collateral.
• The company’s loan is repayable by weekly / fortnightly / monthly as per the borrower’s choice.
• The borrower must be married or should have crossed the marriageable age.
• The borrower should be within the age group of 18 to 60 years.
• The borrower should be engaged in income generation activity and supporting their family.
• Borrowers within the group should not be related to each other and there cannot be more than 2 relatives of the member in the same centre.
• The proposed borrower should not be a defaulter in another MFI / Bank / co-operative society
• The borrower should have sufficient repayment capacity to service her debts as evidenced by family income

The Process

• A member can have Income Generation Loan (IGL) / sanctioned under the microfinance scheme.
• 3 to 5 women households will become one micro-financing group belonging to same street (J.L.G).
• A detailed individual family survey will be conducted to ascertain their family background, occupation, duration of their stay in the area, weekly-assured income levels, neighbourhood opinion etc.,
• Residential proof of their stay in the locality will be ascertained with documentary evidences like Election identity cards, Aadhaar cards, ration card, Rent agreements, Electricity bill etc.,
• On facilitating the affinity group, the group members will submit a request to the RFPL to provide them the loan indicating their acceptance to the terms and conditions of the scheme.
• All the group members will sign the individual loan agreement.
• Each group will have a name and serial number and all their photos will be affixed in the repayment cards for identification.
• The subsequent loan to member will be considered only after the existing loan is repaid in full or an additional loan can also be provided based on proper approval and their repayment record.
• The loans to members in the Group will be guaranteed mutually by the Group members.
• The data entry and the Credit Bureau check are done at the branch level.
• Vernacular application form provided by the company along with terms and conditions of loan / product.
• All the loans are approved from Head Office after ascertaining their credit history.
• Before loan amount transfer, disbursed loan related document will be verified at Head Office.
• All the loan amounts are disbursed only through online transfer to their bank accounts.
• Based on principle acceptance, the borrower will be intimated in writing about time duration of disbursal or rejection of loan application

Loans products:

Product Name	Loan Amount	Loan Tenure	Instalment Frequency	Rate of Interest	Processing fee
Group Loan	20000/-	One year	Weekly, fortnightly, monthly	Board approved rate of interest.	Board approved PF + applicable GST
Individual Loan	30000/- to 200000/-	2 to 3 years	Weekly, fortnightly, monthly	Board approved rate of interest.	Board approved PF+ applicable GST
Shop Loans	30000/- to 150000/-	1 year	Weekly	Board approved rate of interest.	Board approved PF + applicable GST
Staff Loans	50000/- to 150000/-	2 years	Monthly	Board approved rate of interest.	Board approved PF + applicable GST

Amount of the loan

• The loan amount to the client is decided as per the RBI norm. The Company follows the norm of the repayment of monthly obligation to all the debts should be less than 50% of monthly household income. This we can ascertain by using credit information reports before assessing the loan application process

Security

* For loans under the microfinance scheme, no collateral security will be taken.

* The loans will be guaranteed mutually by the members of the Group in the group.

* No security deposit will be collected for the loans sanctioned under microfinance scheme

Margin

No margin will be collected for the loans sanctioned under microfinance scheme.

Rate of Interest

* The board approves the rate of interest. The Company reserves the right to change the ROI in accordance with the borrowing rate, risk premium and margin. The Changes will be incorporated as and when with the board approval. This ROI is same for the group loans and individual loans irrespective of loan amount, tenure and category of borrowers.

* RORS Finance Private Limited abides by RBI norms. RORS Finance Private Limited shall not charge any penalty / charges on pre-closures of loans. The Company proposed to collect delayed interest on the principal overdue amount and not on the entire loan amount.

Processing fee

The Board approved Processing fee on the gross loan amount will be collected upfront along with applicable GST.

Insurance

* Suitable insurance cover will be obtained for borrower / spouse / bread earner’s life with insurance companies.

* The insurance premium and administrative charges if any as per IRDA guidelines will be recovered from the borrower at cost.

Transparency of terms and conditions

* Group training will be provided to each group.

* Every borrower would be explained the terms of credit to enable her to make informed choices.

* On sanction of loans by the company, all terms and conditions would be informed to the borrower by and the same is printed on the loan cards and which also have the fact sheet which clearly gives the ROI and effective rate of interest.

Documentation & sanction of loan:

Demand Promissory Note will be obtained from the borrower and the co-borrower / guarantor. This will be kept attached with the Loan Application Form which will contain the recommendation of the Branch Manager / Regional co-ordinator and sanction under by the competent authority / loan sanction authority.

Disbursement:

The disbursement of the loans will be made at the field level / branch in the presence of at least two staff members of the company.

The disbursement of loan is through by NEFT or by account payee cheque.

All the receipts of money will be dully entered in their repayment cards and also by way of SMS.

Insurance charges, processing fee and the GST amounts will be adjusted from their loan amounts and the remaining net amount will be transferred to their bank accounts.

Loan repayment:

* The loans will be repaid together with accrued interest by the members in equated weekly/fortnightly /monthly instalments at the choice of the members.

* The members will indicate the choice of the repayment periodicity such as weekly, fortnightly or monthly in the loan application itself.

* All the borrowers would be issued a loan card and repayments would be recorded in the loan card with authentication from an authorized employee. The company also send SMS for all the amounts collected from the clients.

* A Photostat copy of Loan agreement will be provided to the clients and after clearing the loan, if required clearance certificate will be issued.

Verifying Utilization and Follow up

Loans granted under various schemes will be followed up through field visits to confirm utilization by the field staff within 30 days of disbursement.
The Regional co-ordinators will randomly (10% of disbursed applications) check the utilization.
The Internal Auditors also randomly verify the end use during internal auditing process time by visiting field.

Provisioning and Write-off Norms:

Provisioning:

The provisioning norms are provided as per Non-Banking Financial Company – Non-Systemically Important Non-Deposit taking Company (Reserve Bank) Directions, 2016 and the circular: rbidocs.rbi.org.in/rdocs/content/pdfs/NSIND01092016.

The provisioning norms adopted by the Company are the higher of the following

1. 1. 1% of the outstanding portfolio. OR
2. 50% of aggregate loan instalments overdue for more than 90 days and less than 180 days and 100% of the aggregate loan instalments overdue for 180 days or more – Para 48 of the circular.
Whichever is higher.
Addition to that, the Company is adopting 0.25% on standard assets as per RBI norms.

Write-off of Microfinance Loans:

All unsecured non-performing loans with dues outstanding more than 6 months (180 Days) and which have been provided 100% in loan loss provisions will be treated as a loss assets considering the non-recoverability and would be written off in that financial year as and when required. Accordingly, the Management is empowered to Write-off the loans considering the merits of the cases during the financial year and such decisions will be placed before the Board for information.

GENERAL:

* Loans will not be sanctioned for purposes which are against the general interest of the community.
* No loan will be sanctioned for Activities which are detrimental to the national interest.
* The policy guidelines should be followed meticulously by all concerned.
* The policy would be reviewed by the Board from time to time to reflect changes in the regulatory environment and accommodate any policy change.

3. RECOVERY POLICY

3.1 The Objective

The Objective of the policy is to clearly define the method and practices to be followed while dealing with recovery of loans keeping in sharp focus the organizational goals and the requirements of its customers / fair practice code.

3.2 General Guidelines

• Customer’s right to privacy would be respected.
• The company is committed to ensure that all written and verbal communication with its customers will be in vernacular language and the company will adopt civil manners for interaction with customers.
• Customer calling time will be between 09.00 hrs and 18.00 hrs, unless the special circumstances of customer’s business or occupation demands otherwise.
• Customer would be provided with all the information regarding dues.

3.3 Dealing with individual defaults

• The company recognizes the needs to have a policy to deal with individual non wilful default.
• Borrowers facing difficulties in making repayment due to genuine family problem, such as sickness / hospitalization of members of the family, extreme business loss and due to other reasons beyond the control of the borrower will be allowed to extend the repayment by restructuring loan instalments / providing repayment holidays without any additional interest.
• Borrowers can put such request for extending repayment period on genuine ground through the field staff. Branch Manager should forward such requests through proper channel to the Head office.

3.4 No Coercive methods

• No coercive methods or force will be used by the field staff to recover loan installments from members. Any act of demeanor that would suggest criminal intimidation or threat of violence would be scrupulously avoided in recovery.

3.5 Avoiding Inappropriate occasions for personal Contacts

• The field staff shall also make personal visit to the houses of defaulting members. However, they shall ensure that they avoid occasion like marriage, decease / death in the family etc., to make such visits. Timings of the visit should also be appropriate.
• In case of continued default, the Branch Manager and Regional Co-ordinator will also visit the group members and seek the help of the other members in effecting recovery.

3.6 Selective Monitoring

• The overdue data of each branch will be reviewed in the weekly staff meetings with action taken reports. Any spurt in overdue will be closely monitored by the HO staff and preventive steps to avoid, flare up of overdue loans.
• A branch reporting more than 5% of portfolio at risk beyond 30 days shall be brought under Stressed asset group.

3.7 Legal Means

Recovery through civil suits would be attempted as last resort.

4. MIS & Reporting

• Company maintaining all its MIS through craft silicon web based software called Br.Net.
• The software is integrated with MIS and accounts.
• All our branches have located in towns and we have proper online connectivity.
• The collection data and cliental information enters at the branch level and approvals for disbursement, day end process will happen at HO level with proper checking.
• At any given point of time software provides for generation of reports like demand sheet, collection details, disbursement, enrolment, PAR, exit details and financial reports like trial balances, profit & loss accounts and balance sheets both branch wise and consolidated.

Each branch shall maintain the following documents / records / reports.

• Loan application along with KYC documents.
• Demand/ Collection sheets
• Daily supplementary sheets
• Daily transaction sheet
• Payment vouchers along with supporting bills
• Monthly Trail balances
• Weekly Overdue reports
• Weekly Staff meeting reports
• Internal auditing report file
• Cash and bank balances maintenance registers
• Monthly Bank Pass sheets
• Attendance register

5. Internal Control Mechanisms:

Regional co-ordinators shall visit the branches and verify the day today transactions, disbursements, field visits, Assessments, interaction with the clients before and after disbursements, end use verification, etc.,

The Internal auditor visits the branches on monthly or bi-monthly basis and the process of monitoring is reviewed periodically with action taken reports.

Company has appointed two staffs as joint signatory to the branch bank account (among branch staff) only for the transaction viewing.

Weekly staff meetings are ensured to deliberate through a prescribed format and such reports are submitted to HO. The head of Operations, Internal Auditor and Regional co-ordinators will attend to the staff meetings personally and through SKYPE on a periodical basis.

Each branch is provided with a safe locker jointly operated by two Senior staffs and the cash in hand in each branch is verified on a random basis through web camera.

All the field staffs are required to carry their identity cards while attending to the collection and cash transit and group orientation / meetings.

6. Customer Grievance Redressal Policy

The Policy is expected to serve as guide for handling customer grievances in an efficient and transparent manner. This will help in developing a healthy customer relationship, trust; finally help in building a stronger organisation with customer focus and commitment. The clients will be provided with the contact details of the higher management staff and network associations for proper grievance redressal.

7. OPERATIONAL DETAILS

RFPL follows a hybrid model of Joint Liability Group and Individuals. A JLG consists of 3-5 customers. Loan disbursement and collections happen at group level on a mutually accepted place, date & time. As on date, RFPL is lending only to women members and for income generation activities.

The company firmly believes in standardization of processes and for that reason it works on a continuous basis to upgrade processes and policies to build efficiency and reduce hassles for staff as well as customers.

RFPL has adopted centralised loan approvals and loan documents verification process.

The Branch staff are engaging only in identifying borrower, group formation, KYC verification, client training, loan processing, documentation, disbursement and collections including verifying end use of funds.

RFPL has a separate team regional level co-ordinators for routine operational processes such as disbursements, overdue monitoring & reporting.

RFPL’s branches make transaction entries in the system and maintain record of borrowers and branch level reports like daily demand collection sheets, daily supplementary sheets, trial balances, overdue reports etc.,

All the branches are computerized. Every branch have to close their daily transactions on daily basis with the support from HO staff.

All the branches have separate bank accounts and two staff members from concerned branch are the joint signatories to operate bank accounts.

8. STAFF HIRING:

1. RORS MFI prefers to hire the staff from within the locality without disturbing their residential stay and also ensures that such hired staffs are not appointed in the same locality and thus avoiding the conflict of interest and also utilise their familiarity to the local area and language.
2. Looking into the size of the institution the staff are recruited preferably through known sources based on their capacities and integrities.
3. All required collection officers are being hired from within the locality.
4. The Credit Managers / Team Leaders are being identified through known circles for their credibility and capacities.
5. Rotation of field staff at periodical intervals.
6. The co-ordinating and management staffs are sourced from its sister institution (RORES society) who have a proven record of integrity, capacity and who are associated with the institution for over a period of 11 to 14 years.
7. For internal auditing and Regional Co-ordinating, we are likely to appoint competitive peoples based on job opportunity advertisement.

9. Employee Engagement

1. RFPL won’t discriminate the Staff against based on gender, religion, caste, marital status or sexual orientation etc.
2. RFPL select candidates based on merits, ethics and integrity.
3. RFPL recruits a candidate from other provider based on satisfactory relieving letter or reference check only.
4. RFPL seeks reference check from candidate’s current employer only after an offer letter is issued to the candidate. However, if request for reference check is not responded to within 15 calendar days (from date of sending the request), RFPL may go ahead with the recruitment.
5. RFPL will respond to request from other provider for reference check within 15 calendar days from receipt of such communication.
6. RFPL encouraged participating in Employee Bureau to submit their employees’ data and check candidate’s employment records.
7. Recruiting from other provider, RFPL will honour the notice period as mutually agreed between prospective employee and her/his current employer.

10. Orientation (training and appraisal)

1. RFPL will provide comprehensive induction training to the employees on policies, processes, regulations, as well as Code of Conduct. Emphasis should be given on customer-interface aspect such as fair treatment, credit assessment, privacy of data, service quality, relationship management and dealing with customer facing difficulty in repayment etc.
2. RFPL regularly assess employees’ understanding of the above elements and conduct refresher training to address the gaps in understanding.
3. RFPL must train their employees on understanding and dealing with gender issues including appropriate interaction with women colleagues and customers.
4. RFPL necessarily orients their employees on professional conduct and integrity issues including expected behaviour and not indulging in any unlawful and anti-social activities.
5. RFPL engages new employees in the branch-level business operations only after completion of the induction training.
6. RFPL ensures that employees directly responsible for CGRM receive detailed training about the system, processes and soft skills for resolving the complaints.
7. RFPL have a transparent incentive and appraisal structure in such a way that it does not lead to perverse sales behaviour, factors for the service quality, incentivizes responsible lending, rewards compliance with the CoC and penalizes breach of the CoC.

11. Well-being

1. RFPL ensure the well-being (for example, adequate remuneration, working hours, working conditions, leaves for personal reasons such as family commitments and emergencies) and security of employee is given due importance.
2. RFPL have well-defined protocol to be followed by employee to handle risks arising from going to difficult area and cash-handling. Provider must indemnify the employees for cases where protocol has been followed but mishap still occurred.
3. RFPL not collect shortfalls in collections from employees unless in proven cases of frauds by employees.
4. RFPL create conducive professional environment for both genders to work and grow.
5. RFPL have an appropriate mechanism to hear and redress the grievances of the employees and provide counselling.
6. RFPL will complete the relieving formalities (including final settlement of pending dues, issuing no-objection certificate and relieving letter) of the employees within 60 calendar days from the last working day of the employee.
7. RFPL respond to request from prospective employer for reference check within 15 calendar days from receipt of such communication. Provider must ensure that notice period is not more than 3 months for employees.

13. Grievance redressal mechanism:

We constituted a Fair Practice Code Compliance Committee to review the implementation at Quarterly intervals and furnish feedback on the same to the Board of Directors. The Policy is expected to serve as guide for handling customer grievances in an efficient and transparent manner. This will help in developing a healthy customer relationship, trust and finally help in building a stronger organization with customer focus and commitment. The clients will be provided with the contact details of the higher management staff and network associations for proper grievance redressal.
The company also collects the contact details of the clients in order to interact them regarding their repayments, group cohesiveness, the staff behaviour with the clients.
We shall provide 5 days’ time to redress grievance of any member at the branch level failing which the borrower can contact the higher authorities for their grievance redressal through the cell number9449852898 to Grievance redressal Cell at Head Office which shall resolve the grievance within 7 days. If the borrower feels he take-up the matter to the Ombudsman, Association of Karnataka Microfinance Institutions or to SRO Sa-dhan, MFIN, New Delhi and the contact details are provided in repayment cards.
Fair Practices Code of conduct boards are displayed in local language in all our office premises and also it is uploaded in our website www.rors.in. Also the following informative displays atbranches.
• Loan products with salient features
• Dos and don’ts for field staffs.

14. Internal control system

The Company has made necessary organizational arrangements to assign responsibility for compliance to designated individuals within the Company and establish systems of internal control including audit and periodic inspection to ensure the same.

Policy on Restructuring Stressed Assets related to resurgence of the Covid-19

Background

RORS Finance Private Limited (hereinafter referred to as “RFPL”) is a Private Limited Company incorporated under the provisions of the Companies Act, 1956 and registered as a non-deposit accepting Non-Banking Financial Company (“NBFC-MFI”) with the Reserve Bank of India (“RBI”).

In the backdrop of economic disruptions caused by the second wave of infections due to COVID-19, RBI on May 05, 2021, has issued two circulars with respect to:

a) Resolution of COVID-19 related stress of Individuals and Small Businesses, and
b) Resolution of COVID-19 related stress of MSMEs

References of Applicable Circulars

1. Circular 1- RBI vide its circular number DOR.STR.REC.11/21.04.048/2021-22 Resolution Framework – 2.0: Resolution of Covid-19 related stress of Individuals and Small Businesses dated May 5, 2021. This circular covers directions to be followed by all financial institutions under the window permitted for resolution of Covid-19 related stress of Individuals and Small Businesses.
2. Circular 2- RBI vide its circular number DOR.STR.REC.12/21.04.048/2021-22 Resolution Framework 2.0 – Resolution of Covid-19 related stress of Micro, Small and Medium Enterprises (MSMEs) Dated May 5, 2021.This circular covers directions to be followed by all financial institutions under the window permitted for resolution of Covid-19 related stress of MSME.
3. Circular 3-The Reserve Bank of India (Prudential Framework for Resolution of Stressed Assets) Directions 2019 (DBR.No.BP.BC.45/21.04.048/2018-19) dated June 7, 2019 (“Prudential Framework”): This circular contains the resolution framework for resolution of stressed assets. These directions as they predate the spread of COVID 19 pandemic, is applicable for resolution of stressed assets in the normal course of business.
4. Circular 4- Circular DBR.No.BP.BC.18/21.04.048/2018-19 dated January 01, 2019 on Micro, Small and Medium Enterprises (MSME) sector; followed by circular DOR.No.BP.BC.34/21.04.048/2019-20 dated February 11, 2020 and then DOR. No. BP. BC/4/21.04.048/2020-21 dated August 06, 2020 Micro, Small and Medium Enterprises (MSME) sector – Restructuring of advances circular allowed Bank/NBFCs to permit one-time restructuring of existing MSME advances classified as ‘standard’ without a downgrade in the asset classification.
5. Circular 5 – Resolution Framework for COVID related Stress circular DOR. No. BP.BC/3/21.04.048/2020-21 dated August 6, 2020 (“Resolution Framework”) and DOR. No. BP. BC/13/21.04.048/2020-21 dated Sept 7, 2020 laying down the parameters for restructuring under the resolution framework guidelines issued on August 6, 2020 referred to as Kamath committee parameters.

Objective of the Policy:

The objective of the Policy is to support borrowers who are currently reeling under the monetary impact of the second wave of the Corona virus pandemic in India

Eligibility Criteria:

1. Individuals who have availed of loans and advances for business purposes and to whom the lending institutions have aggregate exposure of not more than Rs.25 crore as on March 31, 2021.
2. Borrowers engaged in small businesses, including those engaged in retail and wholesale trade, other than those classified as micro, small and medium enterprises as on March 31, 2021, and to whom the lending institutions have aggregate exposure of not more than Rs.25 crore as on March 31, 2021.
3. The borrower’s account was a ‘standard asset’ as on March 31, 2021.
4. Borrower accounts / credit facilities shall not belong to the categories listed in sub-clauses (a) to (e) of the Clause 2 of the Annex to the Resolution Framework 1.0, read with the response to Sl. No. 2 of FAQs on Resolution Framework for Covid-19 related stress (Revised on December 12, 2020).
5. The moratorium period, if granted, may be for a maximum of two years, and shall come into force immediately upon implementation of the resolution plan. The extension of the residual tenor of the loan facilities may also be granted to borrowers, with or without payment moratorium. The overall cap on extension of residual tenor, inclusive of moratorium period if any permitted, shall be two years.
6. The restructuring of the borrower account is invoked by September 30, 2021.
7. The restructuring of the borrower account is implemented within 30 days from the date of invocation.
8. The borrowers having stress on account of COVID-19; and in respect of whom the Company is willing to consider the resolution under this Policy.

Due Diligence Process:

The Company on receipt of a written request application, email / SMS from the eligible Borrower, shall evaluate the proposal for restructuring the loan or extending the moratorium for repayment of the debt of eligible loan, account(s) including evaluation of necessary documents. On due evaluation of the request submitted by the eligible Borrower, We shall execute with the eligible Borrower necessary amendment agreement or other necessary documents in order to record the revised terms. However, compromise settlements are not permitted as a resolution plan for this purpose.

Provisioning:

RFPL shall keep provisions from the date of implementation, which are higher of the provisions held as per the extant IRAC norms immediately before implementation or 10 percent of the renegotiated debt exposure post implementation (residual debt). Residual debt, for this purpose, will also include the portion of non-fund based facilities that may have devolved into fund based facilities after the date of implementation.

Disclosure in the Financial Statement:

The Company shall make appropriate disclosures about the restructured accounts in terms of this Policy in its annual financial statements under the “Notes to Accounts”.

Credit Reporting by the Company:

The restructuring of loan granted to the Eligible Borrowers under this Policy will be treated as new restructured loan account and the credit history of the Eligible Borrowers shall consequently be governed by the respective policies of the credit information companies as applicable to accounts that are restructured.

Miscellaneous:

1. Effective date: This Policy shall be effective from the date of approval of this Policy by the Board.
2. Review of Policy: The Policy shall be reviewed as and when required by the applicable rules and regulations.
3. While Policy outlines the broad internal guidance that the Company will follow to take decisions regarding this restructuring of stressed assets/loan, the Company retains the discretion to take decisions regarding this Policy depending on case specific issues or nuances. The Company reserves the right to amend the Policy within the framework of RBI guidelines .

LOAN PRICING POLICY

INTRODUCTION

RORS Finance Private Limited (hereinafter referred to as “Company” or RFPL) is registered as NBFC MFI. During the course of its operations, the company strictly adheres to various directions, guidelines, circulars, instructions, etc. as issued and stipulated by the RBI from time to time. The interest rate of the loans charged by the NBFC-MFIs to its microfinance borrowers had been determined and regulated by the RBI based on the cap (Average base rate of top 5 commercial banks * 2.75 times). This has now been de-regulated through the revised regulatory guidelines for the microfinance industry issued by RBI on 14th March 2022. Under the new guidelines, RFPL shall put in place a board-approved well-documented interest rate approach for arriving at the all-inclusive interest rate. As the interest cap has been removed by the RBI, keeping in view of the double bottom line of client centricity and business sustainability, now the onus of fixing the interest rate in a responsible manner lies with the boards of RFPL. RFPL Board have a key role & responsibility in the interest rate pricing needs to be approved by them. Regular review and monitoring implementation of pricing guidelines shall be done by Board with key management staff. The key considerations in interest rate pricing shall be (i) Customer centricity, (ii) Business Sustainability, and (iii) Risk Management.

The Boards shall ensure the interest rate pricing is undertaken with necessary due diligence as the same is subject to regulatory inspection by RBI and close monitoring by SROs. The ceiling of interest rate and other charges are to be fixed by the Board, same will be monitored by Sa-Dhan on a quarterly basis. The minimum and maximum ceiling of the interest rate should be defined in the pricing policy document. RORS shall review the ceiling on the interest rate yearly against the industry trends and standards released by the SROs. RFPL shall intimate SROs and mention on their website what is the maximum interest rate and other charges to borrowers on the last working day of every quarter.

POLICY COVERAGE

This Board approved policy covers the following: –

• Components of pricing applicable for all loans (Microfinance and Non-Microfinance)
• spread applicable for microfinance loans
• Ceiling on the interest rate and all other charges applicable to microfinance loans
• Delegation of authority for pricing approval

COMPONENTS OF PRICING FOR ALL LOANS

The components of pricing and their delineation are as follows:

(i) Finance Cost/Cost of Fund

RFPL borrows funds through various means encompassing term loans from various banks and financial institutions and loans from Directors ; Shareholder

Borrowing cost shall include all costs & expenses borne by the Company in relation to borrowing or arrangement of debt, including interest rate, upfront / processing fees, legal & other charges, stamping and documentation charges, arranger fees, prepayment of foreclosures charges, penal charges, and taxes. Further differential costs of interest paid by the banks on FDs and their rate of interest will be taken into consideration. The expected cost of funds will be considered while determining the interest rate.

(ii) Operational Expenses: It pertains to costs related to the end-to-end loan cycle. Considering the business model with staff expenses, RORS‘s cost of operations is greatly influenced by manpower costs, underwriting & collections, operations, fixed assets and infrastructure, technology, management and administration, sales, marketing & promotions, compliance costs, etc.

(iii) Risk Premium: It covers all the risks that the company is exposed to economic, political, geographical concentration, and events like natural calamities, climate change, external events, etc. Loan loss is the annual loss due to analyzed uncollectible loans. While the loan loss may be considerably lower than the delinquency rate, it reflects loans that must be written off. Average Risk premium of last 3 years shall be considered while arriving the interest rate pricing.

(iv) Expected Profit Margin: RORS ensures a reasonable profit margin for the organization to achieve steady growth and sustainable ROI for its stakeholders. At the same time, the profit margins should be reasonable so as not to put an excessive burden on customers. As a small microfinance institution RORS keeps profit margin less than 3%.

ILLUSTRATIVE SPREAD APPLICABLE FOR MICROFINANCE

The range of spread of each component for Microfinance loans is as follows:

Component	Range	Rationale
Cost of Funds	14% to 15%	It is based on existing average cost of funds and projected borrowing costs with an expected sensitivity linked to market movement.
Operational Cost	7% to 8%	It is based on existing average operational cost and projected operational costs with an expected sensitivity based on cost overruns.
Risk Premium	2% to 2.5%	It is based on the historical trend of loan loss and operational / credit risk observed by the company
Margin	2.5% to 3%	It is based on pre-tax expected ROA and net surplus.

CEILING APPLICABLE FOR MICROFINANCE

The ceilings on interest rates and other charges shall be as follows

Item	Ceiling for Microfinance Loans
Interest Rate	As per Board Approval
Upfront Fees & Charges (excluding GST)	As per Board Approval
Prepayment penalty	Not Applicable
Late payment charges on the overdue amount	Applied rate of Interest on EMI principal amount only
GST and other statutory duties & fees	As per Actuals
Insurance Premiums	As per Actuals

PRICING APPROVAL

Interest rates and other charges shall be yearly approved by the Board.

TRANSPARENCY AND DISCLOSURE:

• RORS shall disclose pricing-related information to a prospective borrower in a standardized simplified factsheet/loan card as indicated by RBI.
• Interest rates and other charges/fees charged by RORS on microfinance loans shall not be usurious.
• Any fees to be charged to the microfinance borrower by RORS shall be explicitly disclosed in the factsheet/loan card. The borrower shall not be charged any amount which is not explicitly mentioned in the factsheet/loan card.
• There shall be no pre-payment penalty on microfinance loans. Penalty, if any, for delayed payment shall be applied on the overdue Principal amount and not on the entire loan amount.
• RORS shall prominently display the minimum, maximum and average interest rates charged on microfinance loans in all its offices and branches and details on its website.
• Any change in the interest rate or any other charge shall be informed to the borrower well in advance and these changes shall be effective only prospectively.

Review Monitoring

RORS undertakes a regular review of its product prices and makes suitable changes. The review shall be done as and when required. Any deviation to the policy terms and defined ceilings beyond the delegation authority shall be approved by the Board.

The internal auditing team regularly monitor the implementation of the board approved loan pricing like interest rate, processing charges and other applicable charges in the field.