A loan disbursement letter in the context of Indian banking is an official document issued by a bank or financial institution to a borrower, confirming the disbursement of a loan. This letter typically serves as a formal notification that the loan amount has been transferred or made available to the borrower's account.
Key elements usually included in a loan disbursement letter are:
- Borrower’s details: Name and address of the borrower.
- Loan details: Information about the loan type (e.g. education loan), loan amount, and account number.
- Disbursement amount: The specific amount of money disbursed, which might be the entire loan amount or a portion of it if the loan is disbursed in stages.
- Disbursement date: The date by which the loan amount was transferred to the borrower's account.
- Account number of the recipient: The account number to which the amount was transferred.
- Interest rate: The interest rate applied to the loan.
- Bank contact information: Details for customer service or the loan officer contact in case the borrower has questions or needs assistance.
The loan disbursement letter is an important document as it indicates the official release of funds from the lender to the borrower and provides all the necessary details regarding the disbursement and subsequent loan management.