Document background
The Credit Service Agreement serves as the primary contractual document governing credit relationships in the Indian financial sector. It is essential for financial institutions, banks, and credit service providers who extend credit facilities to corporate or individual borrowers. The agreement must comply with Indian banking regulations, particularly the Banking Regulation Act, 1949, RBI guidelines, and the Indian Contract Act, 1872. This document is crucial when establishing new credit facilities, restructuring existing arrangements, or formalizing credit relationships. It encompasses all aspects of the credit relationship, including facility terms, security arrangements, drawdown procedures, repayment obligations, and default remedies. The agreement's structure allows for customization based on the type of credit facility while maintaining regulatory compliance and protecting both lender and borrower interests.
