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Can bank withheld the pension if credit card bills are not paid
20-Sep-2023 (In Banking / Finance Law)
I'm a retired central government pensioner. Due to a financial crisis i had to flee my hometown, thereby rendering my credit card and loan accounts unpaid. Recently, I was approached by a financial institution and was asked to close the credit card account. I'm being threatened that in case of non payment of the dues I will be served with a legal notice and my pension would be withheld. I wish to know whether the financial institution can withhold my pension and if so, under what circumstances.
The Answer is NO. In your case the Central Government is the sanctioning authority. Financial institutions are only the Disbursing authority. Right to pension is similar to that of Right to property (fundamental Right) hence the financial institution cannot withhold the pension. While availing loan and credit card facility you must have executed a irrevocable undertaking letter that when the debt becomes due, it will be debited to your pension account or any other account. Whatever the credit received, including pension will form a part of the account
" Balance" and Bank has implied general lien on the Credit balance (not the pension) to appropriate towards your dues. Please note that withholding and attaching pension are different issues. My suggestion is to approach the banker and get your dues rephased and find a solution amicably.
" Balance" and Bank has implied general lien on the Credit balance (not the pension) to appropriate towards your dues. Please note that withholding and attaching pension are different issues. My suggestion is to approach the banker and get your dues rephased and find a solution amicably.
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