The Delhi Transport Department issued a circular today instructed all vehicle loan provider banks, financial institutions, and non-banking financial companies (NBFCs) to integrate their services with the Vahan portal latest by 31 October.
With this circular, the No Objection Certificate (NOC) for hypothecation termination from the banks and other financial institutions will be received only in the digital format at the Vahan platform of the National Informatics Centre (NIC).
Hypothecation services, which include addition, continuation, and termination of hypothecation on vehicle loans, are one of the most availed services of the Transport Department under ‘Faceless Services’ launched in August this year by Delhi Chief Minister Arvind Kejriwal.
To bring more banks and financial institutions on board, on 15 November, Transport Minister Kailash Gahlot had convened a meeting in this regard with all major banks offering loans for vehicles in Delhi.
The meeting was attended by state-level lead banks and other financial institutions. It was decided in the meeting that all the banks and other financial institutions would ensure the integration of their vehicle loan data with NIC Vahan software.
HDFC and ICICI together comprise 70-80 percent of all vehicle loans in Delhi and have already integrated their loan-related data with the Vahan portal.
The circular said that with this order of the Delhi Transport Department, the general public now need not visit the bank concerned for the NOC.
People can directly apply for hypothecation removal on the Transport Department website under the Faceless Services of the Delhi government.
Earlier, an applicant after foreclosure of a loan had to apply for termination of hypothecation and submit Form 35 and the NOC from the bank for termination within 90 days.
The circular also says that from 1 November 2021, onwards, those banks or financial institutions who fail to integrate the data with the Vahan portal would not be allowed to enter their data of hypothecation onto the Transport Department database.
Further, the circular instructs the banks and financial institutions not to wait for any request from the vehicle owner to issue the NOC. Instead, they are required to share the data of all vehicles with the Transport Department immediately after the loan has been repaid.