Company Policies

3. SCOPE:

3.1 Applicability

The Know Your Customer and Anti-Money Laundering Policy (the Policy) shall be applicable to Ummeed as notified by the RBI from time to time. The Policy framed thereunder and approved by the Board shall also apply to any third parties relied upon or hired by the Company to perform any of the requirements relating to KYC & Anti-Money Laundering (AML) Program

This Policy establishes minimum requirements for the Company to establish, implement, and maintain an AML Program that is reasonably designed to (a) implement this Policy and (b) to ensure compliance with applicable AML laws, rules and regulations

This Policy requires the Company and each Employee to:

• Protect the Company from being used for money laundering or funding terrorist activities;
• Conduct themselves in accordance with the highest ethical standards
• Comply with the letter and the spirit of applicable AML Laws, and the Company’s AML Program and procedures;
• Be vigilant and escalate AML procedures in respect of individuals/entities who attempt to violate or avoid KYC /AML, procedures or this Policy; and
• Cooperate with AML-related law enforcement and regulatory agencies fully under applicable laws.
• Designate official for reporting purposes to Financial Intelligence Unit (FIU).

Failure to adhere to this Policy may subject employees to disciplinary action, including termination of employment. The employees who suspect unethical behavior should refer the matter to appropriate personnel as directed by their businesses’ policies and procedures.

3.2 Annual Review

The Policy shall be reviewed annually by the Board of Directors of the Company, the Principal Officer and, more frequently, if the changes are required due to modifications in applicable directions, rules and regulations.

3.3 Implementation & Monitoring of Policy

The Audit Committee (AC) shall supervise the implementation and monitoring of the Policy. Amongst other matters, the AC would be responsible for:

• Formulating and periodically reviewing the Policy in line with the applicable regulatory guidelines;
• Reviewing the reports submitted by the Principal Officer (PO)/ the Money Laundering reporting Officer (MLRO) from time to time;
• Instituting an KYC/AML training program;
• Establishing appropriate internal controls, procedures and systems in regard to fraud prevention, KYC/AML etc.

3.4 Policy Approval

The Policy and any significant changes therein shall be approved by the Board of Directors of the Company. Prior to approval by the Board of Directors, the Policy and any significant changes shall also be reviewed by the Audit Committee of the Board, taking into account the feedback of Company’s Principal Officer and also based on internal audit report on implementation of KYC and AML procedures which have been brought under the scope of internal audit.

4. Policy Standards and AML Program Structur

4.1 The KYC and AML Policy has been prepared considering the following 4 key elements:

• Customer Acceptance Policy (CAP)
• Customer identification Procedures (CIP)
• Monitoring of Transactions, and
• Risk Categorization

4.2 For the purpose of the Policy, a ’Customer’ is defined as:

• a person or entity (including an employee) that maintains an account and/or has a business relationship with the Company.
• one on whose behalf the account is maintained (i.e. the beneficial owner);
• beneficiaries of transactions conducted by professional intermediaries, such as Stock Brokers, Chartered Accountants, Solicitors etc. as permitted under the law, and
• any person or entity connected with a financial transaction which can pose significant reputational or other risks to the Company, say, a wire transfer or issue of a high value demand draft as a single transaction.

4.3 Beneficial Owner (BO)

• Where the customer is a company, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical persons, has/have a controlling ownership interest or who exercise control through other means.

  Explanation- For the purpose of this sub-clause-

  • “Controlling ownership interest” means ownership of/entitlement to more than 25 per cent of the shares or capital or profits of the company.
  • “Control” shall include the right to appoint majority of the directors or to control the management or policy decisions including by virtue of their shareholding or management rights or shareholders agreements or voting agreements
• Where the customer is a partnership firm, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have ownership of/entitlement to more than 15 per cent of capital or profits of the partnership.
• Where the customer is an unincorporated association or body of individuals, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have ownership of/entitlement to more than 15 per cent of the property or capital or profits of the unincorporated association or body of individuals.

  Explanation: Term ‘body of individuals’ includes societies. Where no natural person is identified under (a), (b) or (c) above, the beneficial owner is the relevant natural person who holds the position of senior managing official.

• Where the customer is a trust, the identification of beneficial owner(s) shall include identification of the author of the trust, the trustee, the beneficiaries with 15% or more interest in the trust and any other natural person exercising ultimate effective control over the trust through a chain of control or ownership.

4.4 Certified Copy- Obtaining a certified copy by the Company shall mean comparing the copy of the proof of possession of Aadhaar number where offline verification cannot be carried out or officially valid document so produced by the customer with the original and recording the same on the copy by the authorised officer of the Company as per the provisions contained in the Act.

4.5 The Company is aware that availability of sufficient customer information underpins all other AML procedures and should be seen as a critical element in the effective management of Money Laundering (ML) risks

4.6 Customer Acceptance Policy (CAP)

The Company has evolved a Customer Acceptance Policy (CAP) which lays down the criteria for the acceptance of Customers. In line with the RBI’s Master Direction - Know Your Customer (KYC) Direction, 2016, the Company has formulated Customer Acceptance Policy (CAP) which lays down the broad criteria for acceptance of customers which forms an integral part of the Group AML Policy

The features of the CAP are detailed below:

• The Company shall not open any account(s) in anonymous, fictitious or 'benami' name(s). Adequate customer due diligence (CDD) is a fundamental requirement for establishing the identity of the customer. Identity generally means a set of attributes which together uniquely identify a natural person or legal entity. CDD Procedure is followed for all the joint account holders, while opening a joint account.
• Where Permanent Account Number (PAN) is obtained, the same shall be verified from the verification facility of the issuing authority.
• Where an equivalent e-document is obtained from the customer, Company shall verify the digital signature as per the provisions of the Information Technology Act, 2000 (21 of 2000).
• In order to avoid fictitious and fraudulent applications of the customers, and to achieve a reasonable degree of satisfaction as to the identity of the customer, the Company shall conduct appropriate basic due diligence.
• The nature and extent of basic due diligence measures to be conducted at the time of establishment of account opening/relationship, would depend upon the risk category of the customers and involve collection and recording of information by using reliable independent documents, data or any other information. This may include identification and verification of the applicant and wherever relevant, ascertaining of occupational details, legal status, ownership and control structure and any additional information in line with the assessment of the ML risks posed by the applicant and the applicant’s expected use of The Company’s products and services.
• If allowed by the regulations, the Company may rely upon the KYC procedures conducted by other Banks/ Intermediaries having satisfactory customer identification procedures.
• For non-face to face customers, appropriate due diligence measures (including certification requirements of documents, if any) will be devised for identification and verification of such customers. With regard to cross border customers, Company may rely on third party certification/introduction. In such cases it shall be ensured that the third party is a regulated and supervised entity and has adequate KYC systems in place.
• The purpose of commencing the relationship/opening of accounts shall be established and the beneficiary of the relationship/account shall also be identified.
• The information collected from the customer shall be kept confidential.
• Appropriate Enhanced Due Diligence (EDD) measures shall be adopted for customers, with a high-risk profile, especially those for whom the sources of funds are not clear, transactions carried through correspondent accounts and customers who are Politically Exposed Persons (PEPs), resident outside India and their family members/close relatives.
• In respect of unusual or suspicious transactions/applications or when the customer moves from a low risk to a high-risk profile, appropriate EDD measures shall be adopted.
• The Company shall ensure that the identity of the customer does not match with any person with known criminal background or with banned entities such as individual terrorists or terrorist organizations, etc. For this purpose, the Company shall maintain lists of individuals or entities issued by Reserve Bank, National Housing Bank, United Nations Security Council, other regulatory & enforcement agencies, internal lists as the Company may decide from time to time. Full details of accounts/ customers bearing resemblance with any of the individuals/entities in the list shall be treated as suspicious and reported.
• The Company shall not open an account where it is unable to apply appropriate customer due diligence measures i.e., it is unable to verify the identity and /or obtain documents required due to non-cooperation of the customer or non-reliability of the data/information furnished to the Company
• Where the Company is unable to apply appropriate KYC measures due to non-furnishing of information and /or non-cooperation by the customer, the Company may consider closing the account or terminating the business relationship. However, the decision to close an existing account shall be taken at a reasonably senior level, after giving due notice to the customer explaining the reasons for such a decision.

The aspects mentioned in the CAP would be reckoned while evolving the KYC/AML procedures for various customers/products. However, while developing the KYC/CDD procedures, the Company shall ensure that its procedures do not become too restrictive or pose significant difficulties in availing its services by deserving general public, especially the financially and socially disadvantaged sections of society.

4.7 Customer Identification Procedures (CIP)

• The Company shall obtain satisfactory evidence of the identity of the customer in the following cases:
  • If there is any perceived risks at the time of commencement of relationship/opening of account, or
  • when there is a doubt about the authenticity or adequacy of the customer identification data it has obtained, or
  • selling third party products as corporate agents, selling own products and any other product for more than rupees fifty thousand, or
  • when there is a reason to believe that a customer is intentionally structuring a transaction into a series of transactions below the threshold of rupees fifty thousand.

  Such evidence shall be substantiated by reliable independent documents, data or information or other means like physical verification etc.

• Company shall ensure that introduction is not to be sought while opening accounts.
• In order to avoid customer inconvenience, under special circumstances, the Company may also rely on certain data/information available with itself or with external reliable sources for the purpose of establishing the identity of the customer. In such cases, a KYC report in a specified format shall be prepared and approved by an appropriate senior official, as may be specified in the KYC/AML procedures. The KYC report shall be stored properly along with other KYC documents.
• For opening of small value accounts, informal customer segment and smaller/ Semi- urban/ rural location, the Company may, at its discretion, apply differential procedures and provide relaxation in documentation and CDD requirements based on alternate verifications/ documents.
• Indicative guidelines on Customer Identification requirements are provided in the Annexure 1.
• For the purpose of verifying the identity of customers at the time of commencement of an account-based relationship, the Company, may at their option, rely on customer due diligence done by a third party, subject to the following conditions:
  • Records or the information of the customer due diligence carried out by the third party is obtained within two days from the third party or from the Central KYC Records Registry.
  • Copies of identification data and other relevant documentation relating to the customer due diligence requirements shall be made available from the third party upon request without delay.
  • The third party is regulated, supervised or monitored for, and has measures in place for, compliance with customer due diligence and record-keeping requirements in line with the requirements and obligations under the PML Act.
  • The third party shall not be based in a country or jurisdiction assessed as high risk.
  • The ultimate responsibility for customer due diligence and undertaking enhanced due diligence measures, as applicable, will be with the Company.
• Video based Customer Identification Process (V-CIP): A method of customer identification by an official of the Company by undertaking seamless, secure, real-time, consent based audio-visual interaction with the customer to obtain identification information including the documents required for CDD purpose, and to ascertain the veracity of the information furnished by the customer. Such process shall be treated as face to-face process for the purpose of the Master Direction issued by RBI

4.8 Money Laundering and Terrorist Financing Risk Assessment

The Company shall undertake, that:

• Periodic Risk Assessment’ exercise for ‘Money Laundering (ML) and Terrorist Financing (TF);
• Risk assessment process should consider all the relevant risk factors, level of overall risk & type of mitigation to be applied;
• Risk assessment process shall be properly documented and be proportionate to the nature, size, geographical presence, complexity of activities/structure, etc. of the Company;
• Periodicity of risk assessment exercise shall be determined by the Board, which should be reviewed at least annually;
• Outcome of the exercise shall be put up to the Board/ Audit Committee;
• Risk Based Approach (RBA) for mitigation and management of the identified risk and should have Board approved policies, controls and procedures in this regard;
• Monitoring of implementation of the controls and enhance them if necessary

4.9 Risk Categorization

Ummeed shall categorize its customers into High, Medium and Low, based on the perceived AML risk.

• Medium/High Risk from AML perspective- Customers that are likely to pose a higher-than-average risk to the Company may be categorized as medium or high risk depending on customer's background, nature and location of activity, country of origin, sources of funds and his client profile, etc. The Company shall apply enhanced due diligence measures for higher risk customers, especially those for whom the sources of funds are not clear. Such category of customers will include the following:
  • Politically Exposed Persons (PEP’s);
  • Non-Resident Indians;
  • Certain Non-Governmental Organizations (“NGOs”), Trusts and unregulated charities;
  • Money services businesses (“MSBs”), including licensed money transmitters and currency exchangers, and their owners;
  • Dealers in high value or precious goods, such as jewel, gem or precious metal dealers, antique dealers and auction houses, and their owners;
  • Casinos and other gambling businesses, their payment providers, and their owners;
  • Arms and ammunitions manufacturers and dealers;
  • Customers organized, doing business in, or that maintain financial accounts in, jurisdictions that pose a high risk of money laundering, drug trafficking, terrorism, terrorist financing, or corruption or jurisdictions that are not logical for the customer;
  • High Net Worth individuals, with Loan amount of more than Rs.3 crore;
  • Persons (individual or entity) known to the Business Unit to have been convicted of money laundering, drug trafficking, terrorist acts, terrorist financing or other serious crimes.
• All other customers (other than Medium/High Risk category) whose identities and sources of wealth can be easily identified and by and large conform to the known customer profile, may be categorized as low risk. In such cases, only the basic requirements of verifying the identity and location of the customer are to be met
• In terms of extant regulatory guidelines, the Company will put in place a system of periodical review of risk categorization of accounts and the need for applying enhanced due diligence measures in case of higher risk perception on a customer. The Company will carry such review of risk categorization of customers at a periodicity of not less than once in six months. The Company shall also introduce a system of periodical updation of customer identification data (including photograph/s) after the account is opened. The periodicity of such updation will not be less than once in ten years in case of low-risk category customers, not less than once in eight years in case of medium risk categories and not less than once in two years in case of high risk categories.

4.10 AML Risk Mitigation Tools:

Ummeed shall, inter alia, use the following tools to mitigate AML risk

• KYC documentation
• Customer due diligence
• Dedupe check
• CIBIL Checks with credit scores
• Reference checks
• Tele verification
• Field Investigation
• Limit on amount of loan in cash
• Suspicious transaction reporting
• Checking whether amount of jewelry or loan is in line with disclosed sources of income and wealth

4.11 KYC and Customer Due Diligence (CDD)

The Company shall identify the beneficial owner and take all reasonable steps to verify his identity. It shall also exercise on-going due diligence with respect to the business relationship with every client and closely examine the transactions in order to ensure that they are consistent with their knowledge of the customer, his business and risk profile.

For undertaking CDD, following should be obtained from an individual while establishing an account-based relationship or while dealing with the individual who is a beneficial owner, authorised signatory or the power of attorney holder related to any legal entity:

• the Aadhaar number where,(i) he is desirous of receiving any benefit or subsidy under any scheme notified under section 7 of the Aadhaar (Targeted Delivery of Financial and Other subsidies, Benefits and Services) Act, 2016 (18 of 2016); or he decides to submit his Aadhaar number voluntarily to a bank or any RE notified under first proviso to sub- section (1) of section 11A of the PML Act; or the proof of possession of Aadhaar number where offline verification can be carried out; or the proof of possession of Aadhaar number where offline verification cannot be carried out or any OVD or the equivalent e- document thereof containing the details of his identity and address; and
• the Permanent Account Number or the equivalent e-document thereof or Form No. 60 as defined in Income-tax Rules, 1962. Where Permanent Account Number (PAN) is obtained, the same shall be verified from the verification facility of the issuing authority; and
• such other documents including in respect of the nature of business and financial status of the customer, or the equivalent e-documents thereof as may be required:

Provided that where the customer has submitted,

• Aadhaar number, authentication of the customer’s Aadhaar number using e-KYC authentication facility provided by the Unique Identification Authority of India. Further, in such a case, if customer wants to provide a current address, different from the address as per the identity information available in the Central Identities Data Repository, he may give a self-declaration to that effect.
• proof of possession of Aadhaar where offline verification can be carried out, the same shall be done.
• an equivalent e-document of any OVD, then, shall verify the digital signature as prescribed.
• any OVD or proof of possession of Aadhaar number, where offline verification cannot be carried out, verification to be carried out through digital KYC process as prescribed.

Provided further that in case e-KYC authentication cannot be performed for an individual desirous of receiving any benefit or subsidy under any scheme notified under section 7 of the Aadhaar (Targeted Delivery of Financial and Other subsidies, Benefits and Services) Act, 2016 owing to injury, illness or infirmity on account of old age or otherwise, and similar causes, shall, apart from obtaining the Aadhaar number, perform identification preferably by carrying out offline verification or alternatively by obtaining the certified copy of any other OVD or the equivalent e-document thereof from the customer.

Note 1: where its customer submits a proof of possession of Aadhaar Number containing Aadhaar Number, ensure that such customer redacts or blacks out his Aadhaar number through appropriate means where the authentication of Aadhaar number is not required.

Note 2: Biometric based e-KYC authentication can be done by bank official/business correspondents/business facilitators.

Note 3: The use of Aadhaar, proof of possession of Aadhaar etc., shall be in accordance with the Aadhaar (Targeted Delivery of Financial and Other Subsidies Benefits and Services) Act, 2016 and the regulations made thereunder and as amended from time to time.

Note 4: REs other than banks can only carry out Offline Verification of Aadhaar for Note 4: REs other than banks can only carry out Offline Verification of Aadhaar for

Note 5: For opening an account of a Legal Person who is not a natural person, the beneficial owner(s) shall be identified and all reasonable steps in terms of Rule 9(3) of the Rules to verify his/her identity shall be undertaken keeping in view the following:

• (a) Where the customer or the owner of the controlling interest is a company listed on a stock exchange, or is a subsidiary of such a company, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such companies.
• (b) In cases of trust/nominee or fiduciary accounts whether the customer is acting on behalf of another person as trustee/nominee or any other intermediary is determined. In such cases, satisfactory evidence of the identity of the intermediaries and of the persons on whose behalf they are acting, as also details of the nature of the trust or other arrangements in place shall be obtained.

5. Enhanced Due Diligence (“EDD”)

The Company will include reasonable risk-based EDD procedures for its higher risk customers.

The EDD procedures should assist the Company in (a) determining whether the customer appears to be engaged in legitimate business activities and has legitimate sources of funds and (b) anticipating the customer’s usual and expected activity so that suspicious activity can be detected. Higher-risk customers must be approved by a Zonal Credit Manager level or minimum grade of General Manager and the customer’s transactions should be reviewed more closely at account opening and more frequently throughout the term of their relationship.

The Company’s EDD procedures will consider requiring, at account opening stage that additional information and documentation be obtained on higher risk customers, for example, such as:

• Purpose of the account/ End-use.
• Source of funds and wealth.
• Individuals with ownership or control over the account, such as beneficial owners, signatories, or guarantors.
• Financial statements
• Banking references
• Domicile (where the business is organized)
• Citizenship or nationality for individuals
• Proximity of the customer’s residence, place of employment, or place of business
• Description of the customer’s primary trade area and whether international transactions are expected to be routine
• Description of the business operations, the anticipated types, volumes and frequency of transactions, including currency and total sales, and a list of major customers and suppliers.
• Explanations for changes in account activity

The Company’s EDD procedures will consider requiring, periodically throughout the relationship that additional information and documentation be obtained on higher risk customers (who have moved from low risk to high risk), such as:

• Updation of KYC documents in every 2 years.
• EDD is an ongoing process and the Company should take measures to ensure that information is current, and that appropriate risk-based monitoring occurs to ensure that any suspicious activity is escalated, analyzed, and reported, and that other appropriate action is taking.

6. Politically Exposed Persons (“PEPs”)

Politically exposed persons are individuals who are or have been entrusted with prominent public functions in a foreign country, e.g., Heads of States or of Governments, senior politicians, senior government/judicial/military officers, senior executives of state-owned corporations, important political party officials, etc. The Company shall gather sufficient information on any person/customer of this category intending to establish a relationship and check all the information available on the person in the public domain.

7. Negative List

The branches of Ummeed shall maintain a local negative list of persons, to the extent it is possible, and after a thorough name check of the client base by the respective branches, it will ascertain if there is any such match. In the event of a match against one of the local negative lists that is of credit related nature only (no other negativities associated with the name), the PO/ MLRO or any other person with appropriate authority shall have the discretion to approve acceptance of the client/prospect.

8. Sanctions List

Ummeed will comply with the various statutory/ regulatory requirements with regard to Sanctions List of individuals/ groups. In this regard, Ummeed will also comply with the order issued by the Government of India for implementation of Section 51-A of UAPA, 1967. The Company shall update list of such individuals/ entities from time to time based on the advice received from the Government/ Statutory/ Regulatory authorities.

The Company shall not enter into any transaction with a customer whose identity matches with any person with known criminal background or with banned entities and those reported to have links with terrorists or terrorist organizations identified by the Government/ Statutory/ Regulatory authorities. In case, any match is identified with any entity provided in the Sanctions List, the Company shall strictly follow the procedure required to be followed under the legal/ statutory/ regulatory requirements.

The Company shall also take the reference of updated published list of Financial Action Task Force (FATF) of the jurisdictions not fully /partly complying with the FATF Guidelines and ensuring that credentials of none of the existing /new customers matching with the details of persons/entity falling into non-compliance jurisdictions of FATF.

9. Appointment of the Principal Officer (PO) / Money Laundering Reporting Officer (MLRO) & Designated Director.

A senior official of the Company shall be designated as the Principal Officer of the Company. The Principal Officer shall be responsible for overseeing and managing the AML Implementation ensuring the compliance of the Regulatory Directions. The Principal Officer shall be responsible for the day-to-day functioning of the Company’s AML Implementation and must have the knowledge, sufficient independence, authority, time and resources to manage and mitigate the AML risks of the business.

Also, the MD & CEO of the company shall also be the Designated Director for reporting purposes and the same shall be communicated to the FIU or other regulatory institutions.

Explanation: The term “Senior Official” mean and include an official of the Company not below the rank of General Manager or immediately below the level of MD or CEO

Key Responsibilities of the Principal Officer (PO)/ MLRO

• The PO shall develop effective AML programs, including programs to provide AML training to business personnel.
• The PO must be able to assist the respective business heads to assess the ways in which products (existing or under development) may be abused by money launderers.
• The PO must be capable of assisting the respective business heads to evaluate whether any activity is suspicious under the Ummeed standard and under any applicable local law.
• Monitoring the implementation of the company’s KYC/AML policy.
• Reporting of transactions and sharing of the information as required under the law.
• Maintaining liaison with regulatory authorities.
• Ensuring submission of periodical reports to the top Management / Board.
• Organizing continual training of employees to make them aware and keep them up to date with requirements of PMLA and any amendments thereto.
• Review all reports required to be submitted to regulatory/law enforcement authorities
• Reporting to the FIU-IND
• Monitoring of compliance and exception reporting.

Key Responsibilities of the Designated Director

• Review the reports to be submitted to FIU.
• Ensure compliance to guidelines issued.
• Attend meetings/conferences organized by FIU or other regulatory bodies

10. Reporting to Financial Intelligence Unit-India (FIU-IND

Section 12 of PMLA requires, every housing finance company to report information of transaction referred to in clause (a) of sub-section (1) of Section 12 read with Rule 3 of the PML Rules relating to cash and suspicious transactions etc. to the Director, Financial Intelligence Unit-India (FIU-IND). Company shall furnish to the Director, Financial Intelligence Unit-India (FIU-IND), information referred to in Rule 3 of the PML (Maintenance of Records) Rules, 2005 in terms of Rule 7 thereof.

The reporting formats and comprehensive reporting format guide, prescribed/ released by FIU-IND and Report Generation Utility and Report Validation Utility developed to assist reporting entities in the preparation of prescribed reports shall be taken note of. The editable electronic utilities to file electronic Cash Transaction Reports (CTR) / Suspicious Transaction Reports (STR) which FIU-IND has placed on its website shall be made use of by the Company, till installation /adoption of suitable technological tools for extracting CTR/STR from live transaction data.

The Principal Officers shall make suitable arrangement to cull out the transaction details from branches which are not yet computerized and to feed the data into an electronic file with the help of the editable electronic utilities of CTR/STR as have been made available by FIU-IND on its website “http://fiuindia.gov.in”

Principal Officer shall ensure there is no delay in reporting a transaction as delay of each day in rectifying a mis-represented transaction beyond the time limit as specified in the Rule shall be constituted as a separate violation.

Company shall not put any restriction on operations in the accounts where an STR has been filed and ensure that there is no tipping off by officials of the Company to the customer at any level. Officials keep the fact of furnishing of STR strictly confidential.

Robust software, throwing alerts when the transactions are inconsistent with risk categorization and updated profile of the customers shall be put in to use as a part of effective identification and reporting of suspicious transactions.

11. Reporting of Cash Transactions

• Cash Transaction Report- In accordance with the requirements under PMLA, the Company will file Cash Transaction Report (CTR) for each month to FIU -IND by 15 days of the succeeding month. CTR should include the following:
  • all cash transactions of the value of more than rupees ten lakh or its equivalent in foreign currency;
  • all series of cash transactions integrally connected to each other which have been valued below rupees ten lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the aggregate value of such transactions exceeds rupees ten lakh
• Counterfeit Currency Report - In addition to the above, all cash transactions, where forged or counterfeit Indian currency notes have been used as genuine will also be reported by the Company to FIU-IND as Counterfeit Currency Report (CCR) not later than seven working days from the date of occurrence of such transactions. These cash transactions should also include transactions where forgery of valuable security or documents has taken place.
• According to the revised Master Directions, effective from February 17, 2021, the company shall ensure to furnish a quarterly report to the NHB along the lines of the Reserve Bank of India (RBI) Master Circular-Detection and Impounding of Counterfeit Notes dated July 01, 2020, as amended from time to time, and similar instructions issued by the Bank. The above report should be furnished to the NHB within 7 days of the end of the quarter. A "nil" report should be sent in case no counterfeit has been detected during the quarter. (Refer to instructions under para 108.2 Chapter XIV – Miscellaneous instructions of the Master Directions.)

12. Suspicious Transactions- Monitoring and Reporting-

In accordance with suspicious transactions monitoring and reporting laws the Company will establish risk-based procedures and manual processes or automated systems, for monitoring transactions to identify, investigate, and escalate potentially suspicious activity; report suspicious activity to appropriate government authorities, and take other appropriate action, such as terminating a customer relationship. The Company’s Principal Officer is charged with the responsibility of coordinating and overseeing suspicious activity monitoring, including making reports to the FIU -IND.

The Company will file the Suspicious Transaction Report (STR) to FIU -IND within 7 days of arriving at a conclusion that any transaction, whether cash or non-cash, or a series of transactions integrally connected are of suspicious nature. The Principal Officer should record his reasons for treating any transaction or a series of transactions as suspicious. It should be ensured that there is no undue delay in arriving at such a conclusion once a suspicious transaction report is received from a branch or any other office. The Principal Officer will be responsible for timely submission of CTR and STR to FIU-IND.

An illustrative list of Suspicious Transactions is enclosed as Annexure II of the Policy

Confidentiality and Prohibition against disclosing Suspicious Activity Investigations and Reports- The Company will maintain utmost confidentiality in investigating suspicious activities and while reporting STR to the FIU-IND/ higher authorities. A Company Employee shall hold in strict confidence and not disclose to any third party a STR, information from or related to a STR, or the fact that a STR has been filed. Internally, only Employees with a need to know, such as investigators, attorneys involved in the investigation, Employees who must review and approve the STR, and auditors, can have access to STR related information.

The Company will ensure that the customer is not tipped off on the STRs made by them to FIU- IND.

However, the Company may share the information pertaining to the customers with the statutory/ regulatory bodies and other organizations such as banks, credit bureaus, income tax authorities, local government authorities etc.

Central KYC Records Registry (CKYCR) - and reporting requirements under Foreign Account Tax Compliance Act (FATCA)/ Common Reporting Standards (CRS)

As directed by NHB vide their circular no. NHB(ND)/DRS/Policy Circular No.76/2016- 17 dated November 01, 2016 read with circular no. NHB(ND)/DRS/Policy Circular No.59/2013-14 dated January 04, 2014(in compliance with the Government notification dated July 7, 2015 (amending the Prevention of Money Laundering (Maintenance of Records) Rules, 2005) the company will upload the Know Your Customer (KYC) data with CERSAI in respect of new individual accounts (opened w.e.f. Nov 01, 2016). KYC information will be captured for sharing with the Central KYC Record Registry in the manner mentioned in the “Prevention of Money-Laundering (Maintenance of Records) Rules, 2005” (and amendments thereto). The Company shall keep the KYC data ready in digital format in the templates advised by NHB/ RBI of all our existing clients. The Loan Application forms of Retail and Commercial Credit clients may be revised, if required, to capture the data of clients in NHB/ RBI prescribed template in future. The existing clients be contacted to fill up the gaps, if any. The KYC data will be shared with CKYCR as and when advised by NHB. The company shall also take all steps to comply with the FATCA and CRS reporting requirements, as advised by Regulatory Authorities from time to time.

14. Record-keeping Requirements

14.1 The Company shall introduce a system of maintaining proper record of transactions as required with reference to provisions of PML Act and Rules, as mentioned below:

 

• To maintain all necessary records of transactions between the Company and the customer, both domestic and international, for at least five years from the date of transaction;
• To make available the identification records and transaction data to the competent authorities upon request;
• To introduce a system of maintaining proper record of transactions prescribed under Rule 3 of Prevention of Money Laundering (Maintenance of Records) Rules, 2005 (PML Rules, 2005);
• maintain records of the identity and address of their customer, and records in respect of transactions referred to in Rule 3 in hard or soft format.
• all cash transactions of the value of more than rupees ten lakh or its equivalent in foreign currency;
• all series of cash transactions integrally connected to each other which have been valued below rupees ten lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the aggregate value of such transactions exceeds rupees ten lakh;
• all transactions involving receipts by non-profit organizations of rupees ten lakhs or its equivalent in foreign currency;
• all cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine and where any forgery of a valuable security or a document has taken place facilitating the transactions; and
• all suspicious transactions whether or not made in cash and by way of as mentioned in the Rule 3(1) (D).
• records of the identity of all clients of the Company shall be maintained for a period of eight years from the date of cessation of transactions between the clients and the Company

14.2 Records to contain the specified information- The above records, in terms with Rule 3 of the PMLA Rules, to contain the following information:

• the nature of the transactions;
• the amount of the transaction and the currency in which it was denominated;
• the date on which the transaction was conducted; and
• the parties to the transaction.

14.3 The Company shall take appropriate steps to evolve a system for proper maintenance and preservation of information in a manner that allows data to be retrieved easily and quickly whenever required or when requested by the competent authorities.

15. Hiring & Training of Employees and Customer Education

Implementation of KYC Procedures requires the Company to seek information which may be of personal nature, or which has hitherto never been called for. This can sometimes lead to a lot of questioning by the customer as to the motive and purpose of collecting such information. To meet such situation, it is necessary that the customers are educated and apprised about the sanctity and objectives of KYC procedures so that the customers do not feel hesitant or have any reservation while passing on the information to the Company.

Employees: The Company shall put in place adequate screening mechanism as an integral part of employee recruitment/ hiring process. The Company shall train its employees (or the functions/groups) on KYC/ AML requirements/ procedures. The training requirements shall have different focus for frontline staff, compliance staff and staff dealing with new customers. The front desk staff should be specially trained to handle issues arising from lack of customer education. Proper staffing of the audit function with persons adequately trained and well-versed in KYC/AML Measures policies of the HFC, regulation and related issues should be ensured.

Customers: To educate the customers and win their confidence in this regard, the Company will arrange literature containing all the relevant information regarding KYC and AML measures. Such literature may be made available to the customers either directly or through the Company’s website. Further, the Company staff will attend to the same promptly and explain reason for seeking any specific information and satisfy the customer in that regard

16. Audit of the KYC & AML Program and other Reporting Requirements

To provide reasonable assurance that its AML Program is functioning effectively, an audit of its AML Program will be done as part of the internal audit of the Company. The audit will be conducted on a regular basis. The audit will include testing of the effectiveness of elements of the AML Program, compliance with applicable AML Laws, and the Company’s related procedures.

The audit findings and compliance thereof will be put up before the Audit Committee of the Board on quarterly intervals till closure of audit findings.

The Company shall develop a system of audit for the IT framework and compliance with Rules 114F, 114G and 114H of Income Tax Rules.

The books of accounts of persons authorised by Company including brokers/ DSAs or the like, so far as they relate to brokerage functions of the company, shall be made available for audit and inspection whenever required.

17. Consequences of Non-Compliance

Failure to adhere to this Policy, the Company’s AML Program, shall subject the Company’s employees to disciplinary action, up to and including, termination of employment.

Annexure I

 

A. Customer Identification Minimum Requirements- Indicative Guidelines

Trust/Nominee or Fiduciary Accounts

There exists the possibility that trust/nominee or fiduciary accounts can be used to circumvent the customer identification procedures. The Company will determine whether the customer is acting on behalf of another person as trustee/nominee or any other intermediary. If so, The Company will insist on receipt of satisfactory evidence of the identity of the intermediaries and of the persons on whose behalf they are acting, as also obtain details of the nature of the trust or other arrangements in place. While opening an account for a trust, The Company will take reasonable precautions to verify the identity of the trustees and the settlors of trust (including any person settling assets into the trust), grantors, protectors, beneficiaries and signatories. In the case of a 'foundation', steps should be taken to verify the founder managers/ directors and the beneficiaries, if defined.

For opening an account of a trust, one certified copy of each of the following documents or the equivalent e-documents shall be obtained:

• Registration certificate;
• Trust deed;
• Permanent Account Number or Form No.60 of the trust;
• one copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers of Form 60 of the beneficial owner, managers, officers or employees, as the case may be, holding an attorney to transact on its behalf.

Accounts of companies and firm

The Company will be vigilant against business entities being used by individuals as a ’front’ for maintaining accounts with banks or REs. The Company will examine the control structure of the entity, determine the source of funds and identify the natural persons who have a controlling interest and who comprise the management. These requirements may be moderated according to the risk perception e.g. in the case of a public company it will not be necessary to identify all the shareholders.

For opening an account of a company/ firm, one certified copy of each of the following documents or the equivalent e-documents shall be obtained:

• Certificate of incorporation/ Registration Certificate;
• Memorandum and Articles of Association / Partnership deed;
• Permanent Account Number of the company/ firm;
• A resolution from the Board of Directors and/ or power of attorney granted to its managers, officers, Partner or employees to transact on its behalf;
• one copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers of Form 60 of the beneficial owner, the managers, officers, Partners or employees, as the case may be, holding an attorney to transact on the company’s/ Partnership behalf.

Client accounts opened by professional intermediaries

When the Company has knowledge or reason to believe that the client account opened by a professional intermediary is on behalf of a single client, that client will be identified as per procedure listed above or as per this policy.

Accounts of Politically Exposed Persons (PEPs) resident outside India

Politically exposed persons are individuals who are or have been entrusted with prominent public functions in a foreign country, e.g., Heads of States or of Governments, senior politicians, senior government/judicial/military officers, senior executives of state-owned corporations, important political party officials, etc. The Company will gather sufficient information on any person/customer of this category intending to establish a relationship and check all the information available on the person in the public domain. The Company will verify the identity of the person and seek information about the sources of funds before accepting the PEP as a customer. The decision to open an account for PEP will be taken by a Zonal Credit Manager level or minimum grade of General Manager. The above norms may also be applied to the accounts of the family members or close relatives of PEPs.

Accounts of non-face-to-face customers

In the case of non-face-to-face customers, apart from applying the usual customer identification procedures, there will be specific and adequate procedures to mitigate the higher risk involved. Certification of all the documents presented will be insisted upon and, if necessary, additional documents will be called for as deems required by the Company for effective CDD and Identification per applicable RBI directions or PMLA or Rules made thereunder.

B. Indicative List of the Nature and Type of Documents/ Information

For purpose of this policy “Officially Valid Document” (OVD) shall means:

• Passport;
• Driving License;
• Proof of Possession of Aadhaar Number;
• Voter's Identity Card issued by the Election Commission of India;
• Job card issued by NREGA duly signed by an officer of the State Government;
• Letter issued by the National Population Register containing details of name and address;

Provided that:

• Where the customer submits his proof of possession of Aadhaar number as an OVD, he may submit it in such form as are issued by the Unique Identification Authority of India;
• Where the OVD furnished by the customer does not have updated address, the following documents or the equivalent e-documents thereof shall be deemed to be OVDs for the limited purpose of proof of address:
  • Utility bill which is not more than two months old of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill);
  • property or Municipal tax receipt;
  • pension or family pension payment orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address;
  • letter of allotment of accommodation from employer issued by State Government or Central Government Departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies and leave and license agreements with such employers allotting official accommodation;
• the customer shall submit OVD with current address within a period of three months of submitting the documents specified at “b” above
• where its customer submits a proof of possession of Aadhaar Number containing Aadhaar Number, ensure that such customer redacts or blacks out his Aadhaar number through appropriate means.

Explanation: For the purpose of this clause, a document shall be deemed to be an OVD even if there is a change in the name subsequent to its issuance provided it is supported by a marriage certificate issued by the State Government or Gazette notification, indicating such a change of name.

C. KYC Documents List

D. AMLA Documents List:

As per norms prescribed under the “Anti Money Laundering Act & Other Applicable Rules”, we have divided our borrower’s under below mentioned two categories:

• “HIGH RISK”- Applicant (whose income is considered) has a net worth of more than Rs 100 lakhs or they are HUF/Trust/Society.
• “LOW RISK”— Applicant (whose income is considered) has a net worth of less than Rs 100 lakhs.

*Applicant whose income is considered need to sign & submit a declaration/Undertaking confirming his/her net worth.

AMLA requirements are in addition to the KYC requirement and are applicable for all loans — we need to collect any one or more of the following documents to satisfy both ID proof and Address Proof

HIGH RISK

• Passport (unexpired)
• Voters’ Identity Card
• UID (AADHAR card)
• Job card issued by NREGA duly signed by an officer of the State Government,
• Valid Driving License (unexpired)
• PAN Card

We need to collect at least one or more of the above mentioned six documents for AMLA which provides complete ADDRESS and ID PROOF of any one of the APPLICANTS. For example, if PAN is collected for ID, another one of the six dox will be required as support for address proof. In case the Applicant or Co-applicant is/ is not individual but firm/Company/trust, then similar documents are required for the authorized signatory. ADDRESS documents for AMLA purpose may be for any address i.e., present, communication or permanent address (without impacting our KYC requirements).

Further we need relationship proof with other co applicant’s so that we don’t need their individual AMLA document, if the relationship does not exist than we need to follow the above-mentioned guideline for all applicants individually.

LOW RISK

• Passport (unexpired)
• Voters’ Identity Card
• UID (AADHAR card)
• Job card issued by NREGA duly signed by an officer of the State Government,
• Valid Driving License (unexpired)
• PAN Card
• Identity card with applicant's Photograph issued by Central/State Government Departments, Statutory/Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions
• Letter issued by a Gazetted Officer, with a duly attested photograph of the person.

In addition to the above-mentioned documents for LOW-RISK Customers, the below mentioned documents (s. no. 9-14) can also be taken as Officially Valid document as Address Proof for only LOW Risk Customer.

• Utility bill which is not more than two months old of any service provider (electricity, telephone, postpaid mobile phone, piped gas (government supply), water bill);
• Property or Municipal Tax receipt;
• Bank account or Post Office savings bank account statement;
• Pension or family pension payment orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings if they contain the address.
• Letter of allotment of accommodation from employer issued by State or Central Government departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions, and listed companies. Similarly, leave and license agreements with such employers allotting official accommodation; and
• Documents issued by Government departments of foreign jurisdictions and letter issued by Foreign Embassy or Mission in India.

We need to collect at least one or more of the above mentioned eight documents for AMLA which provides complete ADDRESS and ID PROOF of any one of the APPLICANTS. For example, if PAN is collected for ID, another one of the eight dox will be required as support for address proof. In case the Applicant or Co-applicant is/are not individual but firm/Company/trust, then similar documents are required for the authorized signatory. ADDRESS documents for AMLA purpose may be for any address i.e. present, communication or permanent address (without impacting our KYC requirements).

However, in all cases where Address Proof is taken from document no. 9-14 ; in all such cases a second proof for ID needs to be taken as listed in document no.1-8)

c. Digital KYC Process

For the purpose of this section:

“Digital KYC”

means the capturing live photo of the customer and officially valid document or the proof of possession of Aadhaar, where offline verification cannot be carried out, along with the latitude and longitude of the location where such live photo is being taken by an authorised officer of our company as per the provisions contained in the Act.

 

“Equivalent e-document”

means an electronic equivalent of a document, issued by the issuing authority of such document with its valid digital signature including documents issued to the digital locker account of the customer as per rule 9 of the Information Technology (Preservation and Retention of Information by Intermediaries Providing Digital Locker Facilities) Rules, 2016.

 

“Video based Customer Identification Process (V-CIP)”:

a method of customer identification by an official of the Company by undertaking seamless, secure, real-time, consent based audio-visual interaction with the customer to obtain identification information including the documents required for CDD purpose, and to ascertain the veracity of the information furnished by the customer. Such process shall be treated as face-to-face process for the purpose of this Policy.

 

In case a customer applies for digital KYC process then:

• The original OVD is required to be presented.
• Live photograph of the customer shall be taken and the same photograph is embedded in the Customer Application Form (CAF).
• Other guidelines as per the directions of RBI are followed while capturing the Photograph and OVD documents.
• OTP validation, shall be carried out for successful singing of authorized officer on the declaration.
• Thereafter, the Application shall give information about the completion of the process and submission of activation request and also generate the transaction-id/reference-id number of the process. Transaction-id/reference-id shall be intimated to the customer for future reference. Verification shall be done by our officer and CAF shall be digitally signed.

Annexure II

Illustrative List of Suspicious Transactions pertaining to Housing Loans:

• Customer is reluctant to provide information, data, documents;
• Submission of false documents, data, purpose of loan, details of accounts;
• Refuses to furnish details of source of funds by which initial contribution is made, sources of funds is doubtful etc.;
• Reluctant to meet in person, represents through a third party/Power of Attorney holder without sufficient reasons;
• Approaches a branch/office of a HFC, which is away from the customer’s residential or business address provided in the loan application, when there is HFC branch/office nearer to the given address;
• Unable to explain or satisfy the numerous transfers in the statement of account/ multiple accounts;
• Initial contribution made through unrelated third party accounts without proper justification;
• Availing a top-up loan and/or equity loan, without proper justification of the end use of the loan amount;
• Suggesting dubious means for the sanction of loan;
• Where transactions do not make economic sense;
• There are reasonable doubts over the real beneficiary of the loan and the flat to be purchased;
• Encashment of loan amount by opening a fictitious bank account;
• Applying for a loan knowing fully well that the property/dwelling unit to be financed has been funded earlier and that the same is outstanding;
• Sale consideration stated in the agreement for sale is abnormally higher/lower than what is prevailing in the area of purchase;
• Multiple funding of the same property/dwelling unit;
• Request for payment made in favour of a third party who has no relation to the transaction;
• Usage of loan amount by the customer in connivance with the vendor/builder/developer/broker/agent etc. and using the same for a purpose other than what has been stipulated.
• Multiple funding / financing involving NGO / Charitable Organisation / Small / Medium Establishments (SMEs) / Self Help Groups (SHGs) / Micro Finance Groups (MFGs)
• Frequent requests for change of address;
• Overpayment of instalments with a request to refund the overpaid amount;
• Legal structure of client has been altered numerous times (name changes, transfer of ownership, change of corporate seat);
• Unnecessarily complex client structure;
• Individual or classes of transactions that take place outside the established business profile, and expected activities/ transaction unclear;
• Unusual financial transactions with unknown source;
• Payments received from un-associated or unknown third parties and payments for fees in cash where this would not be a typical method of payment;
• Investment in real estate at a higher/ lower price than expected.
• Clients incorporated in countries that permit bearer shares.

Illustrative List of Suspicious Transactions pertaining to Builder/ Project Loans:

• Builder approaching the HFC for a small loan compared to the total cost of the project;
• Builder is unable to explain the sources of funding for the project;
• Approvals/sanctions from various authorities are proved to be fake;
• Management appears to be acting according to instructions of unknown or inappropriate person(s);
• Employees numbers or structure out of keeping with size or nature of the business (for instance the turnover of a company is unreasonably high considering the number of employees and assets used);
• Clients with multijurisdictional operations that do not have adequate centralized corporate oversight;
• Advice on the setting up of legal arrangements, which may be used to obscure ownership or real economic purpose (including setting up of trusts, companies or change of name/corporate seat or other complex group structures);
• Entities with a high level of transactions in cash or readily transferable assets, among which illegitimate funds could be obscured

Level 3

If the customer does not receive any response from the company within 30 days or is not satisfied with the resolution provided by the above channel, the customer may complaint to the Grievance Redressal Officer of by way of writing letter/ Email to:

Mr. Sandeep Verma
Grievance Redressal Officer
Ummeed Housing Finance Private Limited,
Unit 809-815, 8'h Floor, Tower A, Emaar Digital Greens,
Golf Course Extension Road, Sector 61,
Gurugram — 122102
Email ID: - grievance@ummeedhfc.in
Contact No.: 0124-4836480

It is advised to customers to provide Loan details and customer issue in detail for quick redressal. We assure you that your complaint will be looked into at the earliest.

Each customer complaint being unique in nature, can take approximately 30 days for a detailed response to respective customer query or complaint. Once, a query or a complaint is registered with the company, an acknowledgement along with a complaint reference number will be sent to the customer within 7 days. The acknowledgement will contain the name & designation of the official who will deal with the grievance. If the complaint is relayed over Company’s designated telephone helpdesk or customer service number, the customer shall be provided with a complaint reference number and be kept informed of the progress within a reasonable period. While the concerned team works on the query / complaint towards resolution, an interim response intimating the actual time that will be taken to resolve the issue will be sent to the customer. After examining the matter, the company will send the customer its final response or explain why it needs more time to respond and will endeavor to do so within 30 days of receipt of a complaint and he/she will be informed how to take his complaint further if he/she is still not satisfied.

Level 4

In case your complaint has not been resolved to your satisfaction, you can also approach the Complaint Redressal Department of National Housing Bank by lodging its complaints in Online mode at the link: https://grids.nhbonline.org.in/(S(r3ep3nauzqhjria21ha42gms))/Complainant/Default OR in offline mode by post, in prescribed format available at link: https://nhb.org.in/wp-content/uploads/2021/08/complaint-form.pdf on National Hosing Bank’s website. You may fill and send the form along with letters or enclosures, if any, by post or courier to the following address:

Grievance Redressal Department
National Housing Bank
Core 5A, India Habitat Centre
Lodhi Road, New Delhi - 110 003

Definitions

• "Audit Committee" means the Audit Committee constituted by the Board of Directors of the Company in accordance with Section 177 of the Companies Act, 2013 and read with relevant directions under Master Direction Non-Banking Financial Company – Housing Finance Company (Reserve Bank) Directions, 2021.
• "Company" means Ummeed Housing Finance Pvt. Ltd.
• "Disciplinary Action" means any action that can be taken on the completion of /during the investigation proceedings including but not limited to a warning, imposition of fine, suspension from official duties or any such action as is deemed to be fit considering the gravity of the matter.
• "Employee" means every employee of the Company.
• "Protected Disclosure" means a concern raised by a written communication made in good faith that discloses or demonstrates information that may evidence unethical or improper activity. Protected Disclosures should be factual and not fictitious in nature.
• "Subject" means a person or group of persons against or in relation to whom a Protected Disclosure is made or evidence gathered during the course of an investigation under this Policy.
• "Whistleblower" is someone who makes a Protected Disclosure under this Policy.
• "Whistleblower Officer" or "Whistle Committee" or "Committee" means an officer or Committee of persons who is/are nominated/ appointed to conduct detailed investigation of the disclosure received from the whistleblower and recommend disciplinary action. Currently, COO Mr. Sachin Grover is nominated as Whistleblower Officer for the purpose. The Committee, if appointed, should include Senior Level Officers of Personnel & Admin, Internal Audit and a representative of the Division/ Department where the alleged malpractice has occurred. The representative or the officer, being member of the Whistle Committee, shall recuse from the proceedings of the Committee if found allegedly involved in the complaint.
• "Good Faith": An employee shall be deemed to be communicating in “good faith” if there is a reasonable basis for communication of unethical and improper practices or any other alleged wrongful conduct. Good Faith shall be deemed lacking when the employee does not have personal knowledge on a factual basis for the communication or where the employee knew or reasonably should have known that the communication about the unethical and improper practices or alleged wrongful conduct is malicious, false or frivolous.
• "Policy or This Policy" means, "Whistleblower Policy."

   

Scope

This Policy is an extension of Company’s Code of Conduct. Various stakeholders of the Company are eligible to make Protected Disclosures under the Policy. These stakeholders may fall into any of the following broad categories and can be called as Whistleblowers:

• Employees of the Company including Directors, shareholders, etc.
• Employees of other agencies deployed for the Company’s activities, whether working from any of the Company’s offices or any other location
• Contractors, vendors, suppliers or agencies (or any of their employees) providing any material or service to the Company
• Customers of the Company
• Any other person having an association with the Company

A person belonging to any of the above-mentioned categories can avail of the channel provided by this Policy for raising an issue covered under this Policy. The Whistleblowers role is that of a reporting party with reliable information about any malpractices, illegal acts, breach or violation of the Company’s Policies or Code of Conduct, or unethical acts conducted by any company’ employee.

The Policy covers malpractices and events which have taken place/ suspected to take place involving:

• Breach of contract including employee’s code of conduct relating to expected ethical conduct, and behavioral aspect.
• Negligence causing substantial and specific danger to public health and safety
• Manipulation of company data/records
• Financial irregularities, including fraud or suspected fraud or Deficiencies in Internal Controls and check or deliberate error in preparations of Financial Statements or Misrepresentation of financial reports
• Any unlawful act whether Criminal/ Civil
• Pilferation of confidential/propriety information
• Deliberate violation of law/regulation
• Wastage/misappropriation of company funds/assets
• Breach of Company Policy or failure to implement or comply with any approved Company Policy

This Policy should not be used in place of the Company grievance procedures or be a route for raising malicious or unfounded allegations against colleagues.

Guiding Principles On VIGIL Mechanism

To ensure that this Policy is adhered to, and to assure that the concern will be acted upon seriously, the Company will:

• Ensure that the Whistleblower and/or the person processing the Protected Disclosure is not victimized for doing so
• Treat victimization as a serious matter, including initiating disciplinary action on person/(s) indulging in victimization
• Ensure complete confidentiality
• Not attempt to conceal evidence of the Protected Disclosure
• Take disciplinary action, if anyone destroys or conceals evidence of the Protected Disclosure made/to be made
• Provide an opportunity to hear all persons involved especially the Subject

Anonymous Allegation

Whistleblowers must put their names to allegations as follow-up questions and investigation may not be possible unless the source of the information is identified.Disclosures expressed anonymously will ordinarily NOT be investigated. However, the company shall take cognizance of such matters on merit which are general in character to take corrective course of action in the interest of stakeholders and the public, at large.

Protection to Whistleblower

• If one raises a concern under this Policy, he/she will not be at risk of suffering any form of reprisal or retaliation. Retaliation includes discrimination, reprisal, harassment or vengeance in any manner. Company’s employee will not be at the risk of losing her/ his job or suffer loss in any other manner like transfer, demotion, refusal of promotion, or the like including any direct or indirect use of authority to obstruct the Whistleblower's right to continue to perform his/her duties/functions including making further Protected Disclosure, as a result of reporting under this Policy. The protection is available provided that:
  • The communication/ disclosure is made in good faith
  • Whistleblower reasonably believes that information, and any allegations contained in it, are substantially true; and
  • Whistleblower is not acting for personal gain

Anyone who abuses the procedure (for example by maliciously raising a concern knowing it to be untrue) will be subject to disciplinary action, as will anyone who victimizes a colleague by raising a concern through this procedure. If considered appropriate or necessary, suitable legal actions may also be taken against such individuals.

• The Company will not tolerate the harassment or victimization of anyone raising a genuine concern. As a matter of general deterrence, the Company shall publicly inform employees of the penalty imposed and disciplinary action taken against any person for misconduct arising from retaliation. Any investigation into allegations of potential misconduct will not influence or be influenced by any disciplinary or redundancy procedures already taking place concerning an employee reporting a matter under this policy.

Any other Employee/business associate assisting in the said investigation shall also be protected to the same extent as the Whistleblower.

Accountabilities - Whistleblowers

• Bring to early attention of the Company any improper practice they become aware of.
• Although they are not required to provide proof, they must have sufficient cause for concern. Delay in reporting may lead to loss of evidence and also financial loss for the Company.
• Avoid anonymity when raising a concern
• Follow the procedures prescribed in this policy for making a Disclosure
• Co-operate with investigating authorities, maintaining full confidentiality
• The intent of the policy is to bring genuine and serious issues to the fore and it is not intended for petty Disclosures. Malicious allegations by employees may attract disciplinary action
• A whistleblower has the right to protection from retaliation. But this does not extend to immunity for involvement in the matters that are the subject of the allegations and investigation
• Maintain confidentiality of the subject matter of the Disclosure and the identity of the persons involved in the alleged Malpractice. It may forewarn the Subject and important evidence is likely to be destroyed
• In exceptional cases, where the whistleblower is not satisfied with the outcome of the investigation carried out by the Whistle Officer or the Committee, he/she can make a direct appeal to the MD of the Company

Accountabilities - Whistle Officer And Whistle Committee

• Conduct the enquiry in a fair, unbiased manner
• Ensure complete fact-finding
• Maintain strict confidentiality
• Decide on the outcome of the investigation, whether an improper practice has been committed and if so by whom
• Recommend an appropriate course of action - suggested disciplinary action, including dismissal, and preventive measures
• Record Committee deliberations and document the final report

Rights of a Subject

• Subjects have the right to be heard and the Whistle Officer or the Committee must give adequate time and opportunity for the subject to communicate his/her says on the matter
• Subjects have the right to be informed of the outcome of the investigation and shall be so informed in writing by the Company after the completion of the inquiry/ investigation process

Management Action on False Disclosures

An employee who knowingly makes false allegations of unethical & improper practices or alleged wrongful conduct shall be subject to disciplinary action, up to and including termination of employment, in accordance with Company rules, policies and procedures. Further this policy may not be used as a defense by an employee against whom an adverse personnel action has been taken independent of any disclosure made by him and for legitimate reasons or cause under Company rules and policies.

Procedure for Reporting & Dealing with Disclosures

For more details, refer to the procedure for reporting & dealing with disclosures given in Annexure-A.

Access to Reports and Documents

All reports and records associated with “Disclosures‟ are considered confidential information and access will be restricted to the Whistleblower, the Whistle Committee and Whistle Officer. “Disclosures‟ and any resulting investigations, reports or resulting actions will generally not be disclosed to the public except as required by any legal requirements or regulations or any other legitimate needs of law and investigation.

Retention of Documents

All Protected Disclosures in writing or documented along with the results of investigation relating thereto shall be retained by the Company for a minimum period of 8 years.

Reports

A quarterly status report on the total number of complaints received during the period, with summary of the findings of the Whistle Committee and the corrective actions taken will be sent to the Mr. Ashutosh Sharma, Managing Director of the Company.

All cases of representations, investigation, recommendation of the Whistle Committee and Whistle Officer thereupon along with the suggested course of action shall be reviewed by the Audit Committee under periodic reporting to the Board. Audit Committee will also take up the matter of appeal for review.

Company's Powers

The Company is entitled to amend, suspend or rescind modify this policy in whole or in part at any time, subject to legal provisions in force. Whilst, the Company has made best efforts to define detailed procedures for implementation of this policy, there may be occasions when certain matters are not addressed or there may be ambiguity in the procedures. Such difficulties or ambiguities will be resolved in line with the broad intent of the policy. The Company may also establish further rules and procedures, from time to time, to give effect to the intent of this policy and further the objective of good corporate governance.

Procedure for Reporting & Dealing with Disclosures

• How should a Disclosure be made and to whom?

A Disclosure should be made in writing. Letters can be submitted by hand-delivery, courier or by post addressed to the Whistle Officer appointed by the Company.

Emails can be sent to the email id: feedback@ummeedhfc.com. A disclosure should normally be submitted to the Whistle Officer.

Disclosures against any employee in Strategic Job Responsibility Band or the Business Unit Heads or the Executive Directors should be sent directly to Mr. Ashutosh Sharma, Managing Director of the Company.

Only, in exceptional cases, a Whistle Blower can approach to the Chairperson of the Audit Committee.

• Is there any specific format for submitting the Disclosure?

While there is no specific format for submitting a Disclosure, the following details must be mentioned:

• Name, address and contact details of the Whistleblower
• Brief description of the Malpractice, giving the names of those alleged to have committed or about to commit a Malpractice. Specific details such as time and place of occurrence are also important.
• In case of letters, the disclosure should be sealed in an envelope marked “Whistle Blower” and addressed to the Whistle Officer or Managing Director, depending on position of the person against whom disclosure is made.

• What will happen after the Disclosure is submitted?

The Whistle Officer shall acknowledge receipt of the Disclosure as soon as practical (preferably within 07 days of receipt of a Disclosure), where the Whistleblower has provided his/ her contact details.

The Whistle Officer will proceed to determine whether the allegations (assuming them to be true only for the purpose of this determination) made in the Disclosure constitute a Malpractice by discussing with MD of the Company (if required). If the Whistle Officer determines that the allegations do not constitute a Malpractice, he/she will record this finding with reasons and communicate the same to the Whistleblower

If the Whistle Officer determines that the allegations constitute a Malpractice, he/she will proceed to investigate the Disclosure with the assistance of the Whistle Committee comprising of Senior Level Officers of Personnel & Admin, Internal Audit and a representative of the Division/ Department where the breach has occurred, as he/she deems necessary. If the alleged Malpractice is required by law to be dealt with under any other mechanism, the Whistle Officer shall refer the Disclosure to the appropriate authority under such mandated mechanism and seek a report on the findings from such authority.

Subjects will normally be informed of the allegations at the outset of a formal investigation and have opportunities for providing their inputs during the investigation.

The investigation may involve study of documents and interviews with various individuals. Any person required to provide documents, access to systems and other information by the Whistle Officer or Whistle Committee for the purpose of such investigation shall do so. Individuals with whom the Whistle Officer or Whistle Committee requests an interview for the purposes of such investigation shall make themselves available for such interview at reasonable times and shall provide the necessary cooperation for such purpose.

If the Malpractice constitutes a criminal offence, the Whistle Officer will bring it to the notice of the Managing Director and take appropriate action including reporting the matter to the police.

The Managing Director of the Company may, at his/her discretion, participate in the investigations of any Disclosure.

The Whistle Committee shall conduct such investigations in a timely manner and shall submit a written report containing the findings and recommendations to the Whistle Officer as soon as practically possible and in any case, not later than 90 days from the date of receipt of the Disclosure. The Whistle Officer may allow additional time for submission of the report based on the circumstances of the case.

Whilst it may be difficult for the Whistle Officer to keep the Whistleblower regularly updated on the progress of the investigations, he/she will keep the Whistleblower informed of the result of the investigations and its recommendations subject to any obligations of confidentiality.

The Whistle Officer will ensure action on the recommendations of the Whistle Committee/ Officer and keep the Whistleblower informed of the same. Though no timeframe is being specified for such action, the Company will endeavor to act as quickly as possible in cases of proved Malpractice.

• What should I do if I face any retaliatory action or threats of retaliatory action as a result of making a Disclosure?

If you face any retaliatory action or threats of retaliatory action as a result of making a Disclosure, please inform the Whistle Officer in writing immediately. He/ She will take cognizance of each and every such complaint/feedback received and investigate the same accordingly and may also recommend appropriate steps to protect you from exposure to such retaliatory action and ensure implementation of such steps for your protection.

3.Installment Types

• a. Repayment of loan through monthly Instalment.
• b. Amount: ……………………(In Figures). Subject to change with a change in URR in case of floating rate loans.
• c. Date of Commencement of EMI: d. Due Date for EMI

4.Loan Tenure:__________months (Subject to change with a change in Ummeed Reference Rate in case of floating rate loans

5.Purpose of Loan:

• a.Home Loan
• b. Plot Purchase Plus Construction
• c. Repair & Renovation
• d. Home Extension Loan
• e. Construction Refinance
• f. Purchase Refinance (Non Housing)
• g. Loan Against Property
• h. Business Loan
• i. Small Ticket Business Loan
• j. Others (Please Specify) ________________________

6.Fee and Other Charge

• i. On application (all type of fee/ charges, to be specified individually): Please refer table below
• ii. During the term of loan (all type of fee/ charges, to be specified individually): Please refer table below
• iii. On foreclosure (all type of fee/ charges, to be specified individually): Please refer table below
• iv. Fee refundable if loan not sanctioned/disbursed (all type of fee, to be specified individually): Please refer table below
• v. Conversion charges for switching from floating to fixed interest and vice-versa (type of charges, to be specified individually): Please refer table below
• vi. Penalty for delayed payments (all type of penalty, to be specified individually): Please refer table below

Note:

• a. Fee/Charges mentioned above are excluding applicable GST/ taxes and charges, while making payment applicable service tax and other statutory charges to be added as notified by statutory/government bodies.
• b. We share credit performance details of your loan account with credit information bureau of India limited (CIBIL) and with other bureau agencies.

7. Security/ Collateral for the Loan

• Mortgage (Mention detail of the property to be mortgaged as security for the loan):
  ..........................................................................................................................................
  ..........................................................................................................................................
• Guarantee (Mention the name of the guarantors):
  ..........................................................................................................................................
  ..........................................................................................................................................
• Other Security (Mention the details of other securities, if any).
  ..........................................................................................................................................
  ..........................................................................................................................................

8.Insurance of the Property/ Borrowers -

• The borrower/s shall keep the property under security insured with comprehensive Insurance policy equivalent to the loan outstanding at any point of time during the pendency of the loan with Ummeed Housing Finance as the sole beneficiary under said policy/policies.
• The borrower/s may keep his/her life insured equivalent to the loan outstanding at any point of time during the pendency of the loan with Ummeed Housing Finance as the sole beneficiary under said policy/policies.

9. Conditions for Disbursement of the Loan

Ummeed Housing Finance shall not disburse any loan to the Borrower unless the conditions mentioned in the sanction letter and loan agreement are complied with, to the satisfaction of Ummeed Housing Finance. All the loans at the sole discretion of Ummeed Housing Finance.

• The borrower must fulfil the Ummeed Housing Finance requirement of credit worthiness.
• (ii) Submission of all relevant documents as mentioned by Ummeed Housing Finance in the sanction letter / Loan agreement.
• (iii) Legal and Technical assessment of the property.
• (iv) Execution of the loan agreement and such other ancillary documents.
• (v) Submission of Cheques/ACH. any other clearing system in force for the time being towards repayment of installments.
• (vi) Payment of own contribution by the borrower (total cost of flat/house less than the loan amount), as specified in the sanction letter. In case of any alternative arrangement based on a specific product being offered by Ummeed Housing Finance, the same shall be informed to and acknowledged by the Borrower.
• (vii) Post disbursement and during the term of the Loan, the Borrower shall be entitled to prepay the Loan, either partly or fully, however, all term loans shall be repaid after a specified term period, i.e., twelve months from the disbursement, as per rules of the Company, including levy of prepayments charges, subject to applicability as per relevant regulatory directions or guidelines, if any, for the time being in force, and in accordance with the terms and conditions recorded in the Schedules to the loan agreement.

10. Repayment of the Loan & Interest

Repayment of the loan to be by the way of pre-EMI/EMI during the entire tenure of the loan. The instalments (EMI) comprise of both principal repayment and interest component calculated on the outstanding principal and PEMI which comprises of interest component calculated on the outstanding principal. Interest shall be calculated on monthly reducing balance.

• (i) The EMI / PEMI for your Loan is:
• (ii) Numbers of installments to be paid are:
• (iii) Modes of communication of changes in interest rate: through email / SMS / call on the registered phone / mobile number.

11.Brief procedure to be followed for Recovery of overdues

• Telephone/Personal contact and follow up for recovery of instalments and interest due.
• Initiate legal action against the borrower in accordance with provisions of the loan agreement and applicable laws. Before initiating any such legal action, Ummeed Housing Finance shall send notice to the borrower/s as required under applicable law.

12.Date on which annual outstanding balance statement will be issued:

Ummeed Housing Finance will issue an annual outstanding statement reflecting your repayments and current outstanding as of 31st March every year on or before 31st May.

13.Customer Services

• Visiting Hours at office / Branch
  Monday to Saturday 10.00 AM to 06.00 PM
  1st Saturday 10.00 AM to 02.00 PM
  Office will be closed on 2nd Saturday of every month, all Sundays and all public Holiday.
• Borrowers are requested to contact the Branch manager during working hours for any clarifications/guidance.
• Borrower can contact our customer service helpdesk at 1800 2126 127/ 0124 483 6480 during office hours iv. Indicative timelines of common request servicing:
  • a. Loan Account Statement – 15 days from the date of request.
  • b. Photocopy of title documents-21 days from the date of request.
  • c. Issuance of foreclosure letter -21 days from the date of request.
  • d. Return of Original Documents on Closure/ Transfer of Loan- 21 days from the date of request post loan closure

14.Grievance Redressal

Level 1

In case of any query/ complaint/ grievance with respect to the product and services offered by the Company, the customer may register the complaint either by writing a letter/ email or visiting the branch offices or through telephonic communication. The customer may contact our offices through any of the following channels.

• By telephone communication on 1800 2126 127 between 10:00 AM to 05:30 PM (Except Holidays).
• Make an entry of query/ complaint in the Complaint Register at the branch and fill the CRF form.
• By way of writing an email at “customercare@ummeedhfc.com” or “enquiry@ummeedhfc.com

Level 2

If the customer does not receive any response from the company within 15 days or is not satisfied with the resolution provided by the above channel, the customer may complaint to the Grievance Redressal Manager of by way of writing letter/ Email to

Mrs. Veena Mishra
Sr. Manager – Customer Service & Grievance Redressal
Ummeed Housing Finance Private Limited,
Unit 809-815, 8th Floor, Tower A, Emaar Digital Greens,
Golf Course Extension Road, Sector 61,
Gurugram — 122102 Email ID: service@ummeedhfc.in
Contact No.: 0124-4836480

Level 3

If the customer does not receive any response from the company within 30 days or is not satisfied with the resolution provided by the above channel, the customer may complaint to the Grievance Redressal Officer of by way of writing letter/ Email to:

Mr. Sandeep Verma
Grievance Redressal Officer
Ummeed Housing Finance Private Limited,
Unit 809-815, 8'h Floor, Tower A, Emaar Digital Greens,
Golf Course Extension Road, Sector 61,
Gurugram — 122102
Email ID: grievance@ummeedhfc.in
Contact No.: 0124-4836480

It is advised to customers to provide Loan details and customer issue in detail for quick redressal. We assure you that your complaint will be looked into at the earliest

Each customer complaint being unique in nature, can take approximately 30 days for a detailed response to respective customer query or complaint. Once, a query or a complaint is registered with the company, an acknowledgement along with a complaint reference number will be sent to the customer within 7 days. The acknowledgement will contain the name & designation of the official who will deal with the grievance. If the complaint is relayed over Company’s designated telephone helpdesk or customer service number, the customer shall be provided with a complaint reference number and be kept informed of the progress within a reasonable period. While the concerned team works on the query / complaint towards resolution, an interim response intimating the actual time that will be taken to resolve the issue will be sent to the customer. After examining the matter, the company will send the customer its final response or explain why it needs more time to respond and will endeavor to do so within 30 days of receipt of a complaint and he/she will be informed how to take his complaint further if he/she is still not satisfied.

Level 4

In case your complaint has not been resolved to your satisfaction, you can also approach the Complaint Redressal Cell of National Housing Bank by lodging its complaints in Online mode at the link: https://grids.nhbonline.org.in/(S(r3ep3nauzqhjria21ha42gms))/Complainant/Default OR in offline mode by post, in prescribed format available at link: https://nhb.org.in/wp-content/uploads/2021/08/complaint-form.pdf on National Hosing Bank’s website. You may fill and send the form along with letters or enclosures, if any, by post or courier to the following address:

Grievance Redressal Department
National Housing Bank
Core 5A, India Habitat Centre
Lodhi Road
New Delhi -110 003

It is hereby agreed that for detail terms and conditions of the loan, the parties hereto shall refer to and rely upon the loan and other security documents executed/ to be executed by them.

The above terms and conditions have been read by the borrower/s / read over to the borrower by Shri/Smt./Kum. ………………………………………………………of the company and have been understood by the borrower/s

Signature/Thumb Impression
of borrower/s

(Signature of the authorized person of Lender)

Note: Duplicate copy of the MITC should be handed-over to the borrower/s.

Policy on ‘Fit and Proper’ criteria for Directors

The Company has formulated a policy on ‘fit and proper’ criteria for directors on the lines of the guidelines prescribed under RBI Directions. This policy prescribes to Nomination and Remuneration Committee (“NRC”) to ascertain the fit and proper criteria at the time of appointment of Directors, and on a continuing basis. The NRC reviews the appointment/re-appointment of Directors considering their qualifications, expertise, track record, integrity and other 'fit and proper' criteria.

As per this policy, all the Directors are required to meet the ‘fit and proper’ criteria as prescribed by the Reserve Bank, and to provide a ‘declaration and undertaking’ giving additional information on the lines of the format prescribed under RBI Directions. Directors are also required to sign a deed of covenant with the Company, in line with the format prescribed under RBI Directions.

Further as per this policy, the Company will submit to the NHB, a quarterly statement on change of directors, and a certificate from the Managing Director of the Company that fit and proper criteria in selection of the directors has been followed. The Company to submit such statement to the NHB within 15 days of the close of the respective quarter. Further, the statement being submitted for the quarter ending March 31, should be certified by the auditors. In the event, there is no change in the directors during a quarter, a ‘Nil’ statement should be submitted.

Board’s Composition

Board shall have an optimum combination of Executive, Non-Executive and Independent Directors in line with the requirements of the provisions of the Companies Act, 2013, the Articles of Association of the Company and the Shareholder’s Agreement.

Meetings of the Board

At least 4 meetings of the Board shall be held in every calendar year and at least 1 (one) meeting will be held every calendar quarter, with a maximum time gap of 120 (one hundred and twenty) days between two Board meetings. The minimum information to be statutorily made available to the Board shall be furnished to the Directors before the meeting.

The decisions of the Board shall be taken by simple majority of the Directors and each Director shall exercise one vote.

Independent Directors

Independent Directors shall comply with the provisions specified in Schedule IV to the Companies Act, 2013, rules made thereunder, SEBI Regulations and the relevant RBI Directions.

REMUNERATION

The remuneration payable to the Director(s) shall be determined by the Nomination and Remuneration Committee and shall be recommended to the Board for its consideration and approval. The remuneration payable shall be in accordance with the Board approved Remuneration Policy and applicable laws.

COMMITTEES OF THE BOARD

The Board shall constitute Committees with specific terms of reference to focus on specific issues and ensure expedient resolution of diverse matters. The Minutes of the Meetings of all Committees of the Board shall be circulated to the Board of Directors, for their noting.

Details of various committees of the Board are mentioned below:

Audit Committee

An Audit Committee, consisting of not less than three members of its Board of Directors is constituted as required under Section 177 of the Companies Act, 2013. The Audit Committee is having such powers, functions and duties as laid down in Section 177 of the Companies Act, 2013.

The Audit Committee of the Board shall deal in accordance with the terms of reference specified by the Board including recommendation for appointment, remuneration and terms of appointment of auditors, review and monitor the auditor’s independence and performance, and effectiveness of audit process, examination of the financial statement and the auditors’ report thereon, approval or any subsequent modification of transactions of the company with related parties, accounting policies, compliance report, financial reporting and internal control systems.

The Audit Committee must ensure that an Information System Audit carried out separately through a Certified Information System Auditor (CISA) of the critical and significant internal systems and processes is conducted at least once in two years (one year once asset size crosses Rs 500 Crores as per audited financial statements) to assess operational risks faced by the Company. Nomination and Remuneration Committee:

Nomination and Remuneration Committee (“NRC”) is constituted as required under Section 178 of the Companies Act, 2013. NRC is having such powers, functions and duties as laid down in relevant provisions of Section 178 of the Companies Act, 2013.

Terms of references of NRC includes formulating criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration for the directors, key managerial personnel, and other employees. NRC is ensuring 'fit and proper' status of proposed/ existing directors and that there is no conflict of interest in appointment of directors and their independence is not subject to potential threats.

Other Committees

The Company shall constitute various Committees as per the requirement under Housing Finance Companies (NHB) Circulars/Directions issued from time to time. These Committees shall meet time to time as per requirement, minimum number of meeting or prescribed frequency as per applicable laws or NHB Directions / Guidelines.

A list of such committees as follows:

Corporate Social Responsibility (CSR) Committee

Corporate Social Responsibility (CSR) Committee is constituted under provisions of Section 135 of the Companies Act, 2013. CSR Committee indulges itself into formulation of CSR policy, recommend the CSR budget, formulate annual action plan and monitoring CSR activities. Committee monitors activities undertaken by the company under its CSR. Progress is being reported to committee at periodical intervals.

Risk Management Committee

The Risk Management Committee shall be responsible for managing integrated risk, setting up and reviewing risk management policies of the Company from time to time. The Risk Management Committee shall primarily be responsible for identifying, monitoring, managing and mitigating the credit risk, market risk, operational risk and other risks of the Company that can be applicable to the Company considering the business operations of the Company through integrated risk management systems, strategies and mechanisms. Risk Management Committee discusses and recommends various ways to manage all integrated risk on monthly basis and review action plans submitted by management.

Asset Liability Management Committee (ALCO)

The liquidity risk management of the Company has been delegated to Asset & Liability Management Committee (ALCO). The ALCO monitors the asset liability composition of the Company’s balance sheet and determine actions to mitigate risks associated with the asset liability mismatches. The ALCO is responsible for ensuring adherence to the risk tolerance/ limits set by the Board as well as implementing the liquidity risk management strategy. ALCO with respect to liquidity risk should include, inter alia, decide on desired maturity profile and mix of incremental assets and liabilities, sale of assets as a source of funding, the structure, responsibilities and controls for managing liquidity risk, and overseeing the liquidity positions. Members of ALCO meet monthly to review debt position, strategy, liquidity risk management, ALM positioning.

IT Strategy Committee

The IT Strategy Committee has been formed to carry out review and amend the IT strategies in line with the overall strategies of the Company, and to review cyber security arrangements and any other matter related to IT Governance. The IT Strategy Committee shall be responsible for recommending IT related policies and other security policies, evaluating new threats and reducing the risk of intrusion, loss of data integrity, compliance violations, and the committee is also responsible for role-based access controls, resource allocation, documentation, and reporting. The committee meets at least twice a year with a gap less than six months to approve and recommend to the board all IT related policies, and oversee the IT investments, and implementation of IT infrastructural and application projects and strategy.

Wilful Defaulter Identification Committee

The Company shall constitute Wilful Defaulter Identification Committee headed by an Executive Director or equivalent and consisting of two other senior officers of the Company. Identification committee examines and concludes the event of wilful default has occurred, issue a Show Cause Notice to the concerned borrower. Committee meets periodically but at least in a quarter to review cases which may qualify to be concluded as wilful default.

Wilful Defaulter Review Committee

This committee shall be headed by Managing Director/ Chairman and consist of two Non-executive/ Independent Director to review the order passed by Identification Committee or wilful defaulters. Review Committee, will be headed by the MD and consisting, to one ID and one Non-ex Director of Ummeed, shall finally review and confirm the order of Identification Committee.

Borrowing & Banking Committee

The Borrowing & Banking Committee is responsible to (i) To borrow monies from Banks, Financial Institutions, Firms, Bodies Corporate and Other Persons/Entities including securitization transactions up to a sum prescribed by the Board while delegating its Borrowing Powers; (ii) Opening / Closing of Bank/ Imprest Accounts of the Company; (iii) Addition/ Deletion/ Change in Authorised Signatories of the Bank Accounts of the Company; (iv) Revising the authorization limits of the Bank Accounts of the Company; and (v) Availing of payment gateway services, Internet Banking or Cash Management Services or entering any agreement for those services with Banks/ Financial Institutions.

In addition to above, the Board shall constitute other committees, such as Internal Complaints Committee, Customer Service and Grievance Redressal Committee, Whistle Blower Committee, Human Resource Matters Committee, Marketing Committee as may be required for effective functioning of the Company.

• GUIDELINES FOR CONVENING BOARD AND AUDIT COMMITTEE MEETINGS:
  • Finalisation of next Board and Audit Committee day, dates, venue and time at the current meeting;
  • On finalisation of the date of the Meetings the notice to be sent to all the Directors/ Members of the Board and Audit on the same day;
  • Agenda of the said meetings shall be circulated to all the Directors/members not later than seven (7) days (or less, in case of shorter notice) before the date of the meetings. However, annexures having price sensitive information may be circulated three (3) days prior to the date of the meeting;
  • In case representatives Director of Shareholders/ Investors, express their inability to attend the meetings then a waiver to be obtained from attending the Meetings;
  • The quorum of meeting of any committee of the Board shall be one third of total strength of members of committee or two members, whichever is higher, (including one independent director wherever required under relevant provisions as applicable) and the participation of the members by video conferencing or by other audio-visual means shall also be counted for the purposes of quorum.
  • Finalisation of the Minutes of the meetings shall be done within fifteen (15) days from the date of such meetings;
  • The said Minutes to be circulated members of the Board or Audit Committee for their review and comments;
  • The members of the Board/ Audit shall be provided 7 days’ time from the date of circulation to review and comment. The comments, if any, received on the Minutes then it shall be incorporated appropriately after obtaining approval of MD. In the event no comments received from any Directors/ Members within seven (7) days, then it will be deemed approved;
  • The approved Minutes shall be printed on the Minute sheet and will be filed in a Minute Book. The approval/ confirmation of the said Minutes shall be done at the next Meeting and it will be signed by the Chairman of that Meeting.

  PERFORMANCE EVALUATION

  The Nomination and Remuneration Committee of the Company shall evaluate the performance of the individual Directors, the Board, as a whole and its Committees. The Nomination Committee shall provide an overview Report of the evaluation conducted by it, to the Board for their discussion and analysis.

  CONFLICT OF INTEREST

  The Company expects its directors, officers and other employees to act ethically at all times and to acknowledge their adherence to the policy(ies) and code(s) adopted by the Company.

  The Directors, Senior Management and other Employees of the Company shall endeavour to avoid any conflict of interest with respect to their dealings with the Company. A Director who is interested in any proposed transaction shall not exercise any influence over other Board/Committee Members in any manner whatsoever. Further, as regards to appointment of directors, NRC is ensuring that there is no conflict of interest and their independence is not subject to potential threats.

  AUDITORS

  The Board and the Audit Committee of the Company shall be responsible to appoint Auditors, statutory or otherwise, as required under Companies Act and NHB Directions. The Company shall review the independence and performance of Auditors and effectiveness of their audit process periodically.

  The Company has formulated a Policy for appointment of Statutory Auditors (SAs) in line with norms applicable to the Company under the RBI’ circular no. DoS.CO.ARG/ SEC.01/ 08.91.001/ 2021-22 dated April 27, 2021, containing guidelines for appointment of SAs read with para 54 of RBI Directions. All other procedural and reporting requirements related to appointment of SAs are governed by the Policy for appointment of SAs. The Company shall incorporate appropriate terms in the letter of appointment of the firm of auditors and ensure its compliances listed in said policy.

  CODE OF CONDUCT AND POLICIES

  The Code of Conduct for Directors (including Independent Directors) and Employees provides guide to professional code of conduct to be applied in their businesses and affairs in compliance with applicable laws, rules and regulations of India. The Code is applicable to all employees of the Company, including Executive Director(s) and to the Non-Executive Director(s), whether Independent or Non- Independent to the extent of their role and responsibilities in the Company.

  In accordance with the applicable provisions of the Companies Act, 2013, the directions / guidelines issued by the National Housing Bank, under other applicable laws and for internal requirements and operational convenience, the Company shall frame and adopt various policies and shall modify/ update / revise / review as and when required under the applicable laws or due to change in the functioning or the structure of the Company.

  DISCLOSURES

  The Company is committed to make adequate disclosures based on the principles of transparency, timeliness, fairness and continuity. The Board of Directors and employees of the Company shall ensure and make necessary disclosures to the Company, the Regulator(s) / Statutory Authorities, the Shareholders, Investors, Members or other stakeholders as may be required by the applicable laws and the codes / policies of the Company.

  The Board of Directors of the Company or such other person authorized by the Board or any law / regulation, shall ensure that all the disclosures statutorily required to made on behalf of the Company are duly made to the Regulatory/ Statutory authorities or such other persons as maybe required under applicable laws / regulations.

  Further, following disclosures are being made to the Board of Directors on half yearly basis:

  • the progress made in putting in place a progressive risk management system and risk management policy and strategy followed by the HFC; and
  • conformity with corporate governance standards viz., in composition of various committees, their role and functions, periodicity of the meetings and compliance with coverage and review functions, etc.

  The Company will also disclose the following (wherever applicable) in its Annual Financial Statements:

  • registration/ license/ authorisation, obtained from other financial sector regulators;
  • ratings assigned by credit rating agencies and migration of ratings during the year;
  • penalties, if any, levied by any RBI/ NHB or any enforcement authority;
  • information namely, area, country of operation and information about JV and overseas subsidiaries, if any; and
  • Asset-Liability profile, NPAs and movement of NPAs, details of all off-balance sheet exposures, exposure to real estate, exposure to capital market, structured products issued by them as also securitization/ assignment transactions and other disclosures, as prescribed under RBI Directions;

  COMPLIANCE OFFICER

  A qualified Company Secretary shall be the Compliance Officer of the Company.

  REVIEW

  The Board or its Committee may review the policy from time to time as may be required. Changes, if any, shall be effective only upon approval by the Board itself or by COO / MD wherever authorised by the Board.

2.2 Review of Policy

The Policy shall be reviewed periodically on such gaps as considered necessary by the Audit Committee of the Board and whenever required under the applicable directions, rules and regulations.

2.3 Policy Approval

The Board of Directors or the Audit Committee of the Board may review and may amend this policy, as and when required by the applicable laws, rules and regulations.

3. POLICY STANDARDS

All Related Party Transactions should be reported to the Audit Committee and referred for approval to the relevant authorities in accordance with this Policy.

4. DEFINITIONS

• 4.1.1 “Act” means the Companies Act, 2013 and rules made thereunder and includes any amendment or modification thereof.
• 4.1.2 “Arms’ Length Transaction” means a transaction between two related parties that is conducted as if they were unrelated, so that there is no conflict of interest.
• 4.1.3 “Audit Committee or Committee” means a committee of the Board of Directors of the Company constituted under provisions of the RBI Directions and the Companies Act, 2013.
• 4.1.4 “Board” means the Board of Directors of the Company constituted under provisions of the Companies Act, 2013.
• 4.1.5 “Company” means Ummeed Housing Finance Private Limited.
• 4.1.6 “Key Managerial Personnel” means key managerial personnel as defined under the Companies Act, 2013 and includes
  • i) Managing Director, or Chief Executive Officer or Manager and in their absence, a Whole-Time Director;
  • ii) Chief Financial Officer; and
  • iii) Company Secretary.
• 4.1.7 “Material Related Party Transaction” means a transaction with a Related Party shall be considered material if the transaction / transactions to be entered into individually or taken together with previous transactions during a financial year, exceeds ten percent of the annual consolidated turnover of the company as per the last audited financial statements of the Company or such limits as may be prescribed either in the Companies Act, 2013 or other applicable regulatory directions, from time to time. Provided that in case of any amendment to the Act or applicable directions, rules and regulations, definition of Material transactions will be deemed to be changed without any further approval of Audit Committee or Board.
• 4.1.8 “Related Party”: An entity shall be considered as related to the Company if:
  • i) Such entity/ person is a related party as per Section 2(76) of the Companies Act, 2013, or
    • a) Director or a KMP or their relatives, or
    • b) a Firm, in which a director, manager or his relative is a partner,
    • c) a Private Company in which a director or manager or his relative is a member or director,
    • d) a Public Company in which a director or manager is a director and holds along with his relatives, more than 2% of its paid-up share capital,
    • e) any Body Corporate whose Board of Directors, managing director or manager is accustomed to act in accordance with the advice, directions or instructions of a director or manager and
    • f) any Person on whose advice, directions or instructions a director or manager is accustomed to act as related party transactions.
    • g) any Body Corporate which is:
      • • holding, subsidiary or an associate company of such company
      • • a subsidiary of a holding company to which it is also a subsidiary
      • • an investing company or the venture of the company
    • h) a Director (other than an independent director) or KMP of the holding company or his relative
  • ii) Such entity is a related party under the IND AS 24 or applicable Accounting Standards issued by the ICAI
• 4.1.9 “Related Party Transaction” shall mean all transactions between the Company on one hand and one or more related party on the other hand including contracts, arrangements and transactions as envisaged in Section 188(1) of the Companies Act, 2013 and/ or IND AS 24 or applicable Accounting Standards issued by the ICAI
• 4.1.10 “Relative” as per section 2 (77) of the Companies Act, 2013, with reference to any person, shall be deemed to be relative of another, if he or she is related to another in the following manner, namely: -
  i) Father, including step-father;
  ii) Mother, including step-mother;
  iii) Son, including step-son;
  iv) Son’s wife;
  v) Daughter;
  vi) Daughter’s husband;
  vii) Brother, including step-brother;
  viii) Sister, including step-sister;
  ix) are members of a Hindu Undivided Family;
  x) they are Husband and wife.

5. IDENTIFICATION OF POTENTIAL RELATED PARTY TRANSACTIONS

• 5.1 Every Director and Key Managerial Personnel (KMP) shall, at the time of appointment, annually and whenever there is any change in the information already submitted, provide requisite information (Form MBP-1) about all persons, firms, entities in which he is interested whether directly or indirectly, to the Company Secretary.
• 5.2 For identification of the Related Parties, a Related Parties (“RP”) list will be prepared basis intimations received from the Directors/ KMPs or changes in management or shareholding structure from time to time. The updated RP List will be shared with all relevant functions and shall be referred for monitoring of the transactions and ensuring compliance at their end.
• 5.3 Each director and Key Managerial Personnel shall be responsible for providing notice to the Board or Audit Committee of any potential Related Party Transaction involving him or her or his or her Relative, including any additional information about the transaction that the Board/Audit Committee may reasonably request. The Board/Audit Committee will determine whether the transaction does, in fact, constitute a Related Party Transaction requiring compliance with this policy.
• 5.4 Identify the Ordinary Course of Business in relation to company.
• 5.5 The Company’s directors and KMP shall endeavor to intimate such notice of any potential Related Party Transaction well in advance so that the Audit Committee/ the Board has adequate time to obtain and review information about the proposed transaction. All Related Party Transactions for the period will be placed for approval / noting / ratification by the Board of Directors/ Audit Committee, in accordance with this Policy. To review a Related Party Transaction, the Board / Audit Committee will be provided with all the relevant information as mentioned in the Act pertaining to the Related Party Transaction, including the name of the related party, the nature of the relationship, nature of the transaction, whether the transaction is in the ‘Ordinary Course of Business’, whether the transaction is at ‘Arm’s Length’ and any other matter, as may be required.

6. APPROVING AUTHORITIES

• 6.1 Audit Committee: Any transaction or any subsequent modification of transactions of the company with related parties shall require the approval of the Audit Committee at a Meeting of the Audit Committee or by Circulation.
• 6.2 Board of Directors: All “Related Party Transactions which are not in OCB or not at an Arm’s Length” shall require the prior approval of the Board of Directors at a Meeting of the Board and cannot be passed by Circulation.
• 6.3 Shareholders: All “Related Party Transactions which are not in OCB or not at an Arms’ Length” and exceeding the prescribed criteria under Section 188 of the Act, shall require prior approval of the Shareholders’ by means of an Ordinary Resolution passed at a General Meeting.

7. PRIOR APPROVAL REQUIRED FOR RELATED PARTY TRANSACTIONS AND OMNIBUS APPROVAL

All Related Party Transactions defined/ stipulated under the Companies Act, 2013 shall require prior approval from the Audit Committee. For any ratification or exception, parameters mentioned in this Policy shall be followed.

The Audit Committee may grant omnibus approval, on an annual basis, for Related Party Transactions proposed to be entered into by the Company subject to the following conditions:

• a) The Audit Committee shall lay down the criteria for granting the omnibus approval in line with the policy on Related Party Transactions of the Company and such approval shall be applicable in respect of transactions which are repetitive in nature;
• b) The Audit Committee shall satisfy itself the need for such omnibus approval and that such approval is in the interest of the Company;
• c) Such omnibus approval shall specify (i) the name/s of the related party, nature of transaction, period of transaction, maximum amount of transaction that can be entered into, (ii) the indicative base price / current contracted price and the formula for variation in the price if any and (iii) such other conditions as the Audit Committee may deem fit;
• d) The omnibus approval shall be valid for one year as per rule 6A of the Companies (Meeting of Board and its Power) Rules, 2014.

Provided that where the need for Related Party Transaction cannot be foreseen and aforesaid details are not available, Audit Committee may grant omnibus approval for such transactions subject to their value not exceeding Rs.1 crore per transaction.

Omnibus approval shall not be made for transactions in respect of selling or disposing of the undertaking of the company and/or any other transaction the Audit Committee may deem not fit for omnibus approval.

Additionally, other related party transactions prescribed under the IND AS 24 or applicable Accounting Standards issued by the ICAI shall be presented to the Audit Committee for its review and noting.

8. ORDINARY COURSE OF BUSINESS

The phrase “Ordinary Course of Business” has not been defined under the Act or Rules made thereunder. However, the Company will adopt a reasonable approach/ methodology to demonstrate ‘Ordinary Course of Business’ which shall, inter alia, include the Nature of the transaction, the frequency / regularity / length of time the company is engaged such transaction, or transactions permitted by the Object Clause in the Memorandum of Association of the Company or such transaction/ action is consistent with the past practices and was taken in the ordinary course of the normal day-to-day operations of such company, common commercial practice i.e. customarily taken, in the ordinary course of the normal day-to-day operations of other companies that is in the same / similar line of business.

9. ARM’S LENGTH PRICING

For transactions between two related parties to be considered to be at Arm’s Length Pricing, the transaction should be conducted between the two parties as if the parties were unrelated, so that there is no conflict of interest i.e. Arm’s Length Pricing is the condition or the fact that the two related parties transact as independent (un-related) parties and on an equal footing from one or more of the following aspects viz. nature of goods/ services, risk assumed, assets/ resources employed, key terms/ covenants.

10. REVIEW AND APPROVAL OF RELATED PARTY TRANSACTIONS

Related Party Transactions will be referred to the next regularly scheduled meeting of the Audit Committee for review /noting and/ or approval as above. Any member of the Committee who has a potential interest in any Related Party Transaction will recuse himself or herself and abstain from discussion and/ or voting on the approval of the Related Party Transaction. In the event the management determines that it is impractical or undesirable to wait until a meeting of the Committee for the approval of a Related Party Transaction, due to business exigency or otherwise, such transaction may be approved by the Committee by way of circular resolution in accordance with this Policy subject to applicable statutory provisions of the Act for the time being in force and as amended from time to time. Every such transaction as approved through resolution passed by circulation shall be placed within three months from the date of transaction at the Audit Committee meeting for ratification.

To review a Related Party Transaction, the Committee will be provided with all relevant material information of the Related Party Transaction as required under the Act, including the terms of the transaction, business purpose of the transaction, benefits to the Company and to the Related Party, and any other relevant matters. In determining whether to approve a Related Party Transaction, the Committee may consider the following factors, among others, to the extent relevant to the Related Party Transaction:

• a) Whether the terms of the Related Party Transaction are fair and on arm’s length basis to the Company and would apply on the same basis if the transaction did not involve a Related Party;
• b) Whether there are any compelling business reasons for the Company to enter into the Related Party Transaction and the nature of alternative transactions, if any;
• c) Whether the Related Party Transaction would affect the independence of an independent director;
• d) Whether the proposed transaction includes any potential reputational risk issues that may arise as a result of or in connection with the proposed transaction;
• e) Whether the Company was notified about the Related Party Transaction before its commencement and if not, why pre-approval was not sought and whether subsequent ratification is allowed and would be detrimental to the Company; and
• f) Whether the Related Party Transaction would present an improper conflict of interest for any director or Key Managerial Personnel of the Company, taking into account the size of the transaction, the overall financial position of the director, Executive Officer or other Related Party, the direct or indirect nature of the director’s, Key Managerial Personnel’s or other Related Party’s interest in the transaction and the ongoing nature of any proposed relationship and any other factors the Board/ Committee deems relevant.

If the Audit Committee determines that a Related Party Transaction should be brought before the Board, or if the Board in any case decides to review any such matter or it is mandatory under any law for Board to approve the Related Party Transaction, then the considerations set forth above shall apply to the Board’s review and approval of the matter, with such modification as may be necessary. Further, the Audit Committee shall review, at least on a quarterly basis, the details of Related Party Transactions entered by the Company pursuant to each of the omnibus approval given.

11. NOTWITHSTANDING THE FOREGOING, THE FOLLOWING RELATED PARTY TRANSACTIONS SHALL NOT REQUIRE APPROVAL OF THE AUDIT COMMITTEE:

• i) Any transaction that involves the providing of compensation to a director or Key Managerial Personnel in connection with his or her duties to the Company or any of its subsidiaries or associates, including the reimbursement of reasonable business and travel expenses incurred in the ordinary course of business.
• ii) Any transaction in which the Related Party’s interest arises solely from ownership of securities issued by the Company and all holders of such securities receive the same benefits pro rata as the Related Party.

12. RELATED PARTY TRANSACTIONS NOT APPROVED UNDER THIS POLICY

In the event the Company becomes aware of a transaction with a Related Party that has not been approved under this Policy prior to its consummation, the matter shall be reviewed by the Audit Committee. The Audit Committee shall consider the relevant facts and circumstances regarding the Related Party Transaction and failure to report RP Transaction. The Committee, while deciding on the matter, shall evaluate all options available to the Company, including ratification, revision or termination of the Related Party Transaction and shall take any such action it deems appropriate including immediate discontinuation or rescission of the transaction. The Audit Committee, while considering a Related Party Transaction, will have authority to modify or waive any procedural requirements of this Policy subject to compliance of applicable statutory provisions for the time being in force.

13. INTERNAL PROCESS FRAMEWORK

The Company shall institute an appropriate internal process framework to ensure requisite approvals/ noting of all Related Party Transactions to comply with this Policy.

14. COMMUNICATION TO ALL THE DIRECTORS AND CONCERNED EMPLOYEES

The relevant aspects of this Policy will be communicated to all the directors and concerned employees/ officials of the Company.

B. Composition of CSR Committee:

The Committee shall consist of total 3 (three) Directors from the Board, which includes at least 1 (one) Independent Director and other 2 (two) Directors as decided by the Board from time to time.

C. Role and Responsibilities of CSR Committee:

• To formulate and recommend to the Board the Corporate Social Responsibility policy which shall include the activities to be undertaken by the Company as detailed in Schedule VII of the Companies Act, 2013.
• To recommend the amount of expenditure to be incurred on activities referred above.
• To monitor the Corporate Social Responsibility activities of the Company from time to time.
• Review and reassess the adequacy of CSR Policy periodically and recommend any proposed changes to the Board for approval.
• To institute a transparent monitoring mechanism for implementation of the CSR projects or programs or activities undertaken by the company.
• Coordinate with such other agency/ entity for implementing programs and executing initiatives as per CSR policy and shall review the performance of such other agency/ entity periodically.
• Delegate authority to subcommittees/ any individual when appropriate.

D. CSR Activities to be undertaken by the Company, as detailed in Schedule VII of the Companies Act, 2013 is given below:

The CSR Committee constituted under Section 135(1) of Companies Act, 2013 will work on any or all of the following activities as detailed in Schedule VII of the Companies Act, 2013, relating to:

• Eradicating hunger, poverty and malnutrition, promoting health care including preventive health care.
• Promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly and the differently abled and livelihood enhancement projects.
• Training to promote Rural sports, Nationally recognized sports, Paralympic sports and Olympic sports
• Contributions to public funded Universities and Institutions;
• Rural development projects and Slum area development. Explanation.- For the purposes of this item, the term `slum area' shall mean any area declared as such by the Central Government or any State Government or any other competent authority under any law for the time being in force.

E. CSR Reporting:

The disclosure of contents of Corporate Social Responsibility Policy in the Board’s report and on the company’s website, if any, shall be as per Format attached to this policy at Annexure-I.

F. Implementation Vehicle for CSR Activities:

As per the requirement, the CSR activities shall be undertaken by the Company, as per its CSR policy, on various projects or program or activities, as approved by CSR committee, through the registered trust or through registered society or through a Company established under Section 8 of the Companies Act, 2013.

G. CSR Obligation:

There is no maximum ceiling for CSR expenditure by the Company. However, as per clause 135 of the Companies Act, Company is required to spend, in every financial year, at least 2% of the average net profits of the company made during the 3 immediately preceding financial years on CSR activities.

In case the company spends an amount in excess of the aforesaid 2% of average net profits made during previous 3 fiscal, then such excess amount may be set off against the requirement to spend for such number of succeeding financial years and in such manner, as may be prescribed by the Government in this behalf.

At the end of each financial year, the Company shall prepare an annual report on CSR containing the particulars as furnished in Annexure-I.

H. CSR Budget:

The annual budget for Ummeed’ CSR initiative shall be approved by the Board of Directors on recommendation of the CSR Committee of the Company. The allocation of funds to specific projects/ programs will be as decided by the Board.

Any surplus arising out of the CSR Projects or programs or activities shall not form part of the business profit of the Company. CSR expenditure shall include all expenditure including contribution to corpus, or on projects or programs relating to CSR activities approved by the Board on the recommendation of its CSR Committee, but does not include any expenditure on an item not in conformity or not in line with activities which fall within the areas or subjects, specified in Schedule VII of the Act.

I. Monitoring the CSR activities:

Various CSR activities, projects and programs are to be monitored by the Company and progress is to be reported to be CSR committee of the Board at periodical intervals as may be required by the Committee, in the proforma similar to the annual report as furnished in the Annexure I.

J. Display of CSR activities on the website:

The contents of the CSR policy of the Company as approved by the Board shall be displayed in the Companies official website. Further, the annual report as per Annexure-I shall also be displayed in the Company’s website for public view.

K. Amendments in the policy:

Any amendment or modification to the CSR policy shall be approved by the Board on the recommendation of the CSR committee. The contents of this policy shall be disclosed on the website of the Company at: https://www.ummeedhfc.com/

Annexure-I (FORMAT FOR THE ANNUAL REPORT ON CSR ACTIVITIES TO BE INCLUDED IN TIIE BOARD'S REPORT)

• A brief outline of the company’s CSR policy including overview of projects or programs proposed to be undertaken and a reference to the web-link to the CSR policy and projects or programs
• The composition of the CSR Committee.
• Average Net Profit of the company for last 3 financial years.
• Prescribed CSR expenditure (2% of this amount as in (c) above).
• Details of CSR spent during the financial year:
  • a) Total amount to be spent for the financial year.
  • b) Amount unspent, if any;
  • c) Manner in which the amount spent during the financial year is detailed below:

    (1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)
    Sr. No.	CSR project/ activity identified	Sector in which the Project is covered	Projects/ Programs 1.Local area/others- 2.specify the state and district where projects or program was undertaken	Amount outlay (budget) project or program wise	Amount spent on the projects or programs Subheads: 1.Direct expenditure on projects or programs, 2.Overheads:	Cumulative spend up to to the reporting period.	Amount spent: Direct or through implementing agency*
    1
    2
    	TOTAL

• In case the company has failed to spend the 2% of the average net profit of the last three financial years or any part thereof, the company shall provide the reasons for not spending the amount in its Board report.
• A responsibility statement of the CSR Committee that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and policy of the Company.

Sd/-
(CEO of the Company/MD)

Sd/-
(Chairman of CSR Committee)