Financial challenges can arise unexpectedly. A sudden job loss, a medical emergency, or a business downturn can make it impossible to keep up with loan EMIs. If you are facing such a situation with your Yes Bank personal loan or credit card dues, you are not alone. Thousands of borrowers find themselves in a debt trap where high interest rates and penalties make repayment seem impossible.
Ignoring the problem will only make it worse. The constant calls from recovery agents, the fear of legal notices, and the stress of mounting debt can be overwhelming. However, there is a legal and dignified way out. Loan Settlement is a viable option that allows you to close your loan account by paying a reduced amount, often significantly lower than what you currently owe.
At AMA Legal Solutions, we specialize in negotiating with banks like Yes Bank to secure favorable settlement terms for our clients. We stand between you and the bank, ensuring you are treated with respect and that your rights are protected throughout the process.
One Time Settlement (OTS) is a formal compromise agreement where Yes Bank agrees to accept a reduced payment to close a non-performing loan account. This typically happens when the loan has been classified as a Non-Performing Asset (NPA), usually after 90 days of non-payment.
The bank realizes that recovering the full amount through legal means might be time-consuming and expensive. Therefore, they may agree to waive the accumulated interest, penal charges, and even a portion of the principal amount to recover what they can immediately. This is a win-win: the bank cleans up its balance sheet, and you get debt relief.
*Figures are for illustration. Actual settlement depends on individual cases, delinquency period, and negotiation.
Settlement is not a right but a negotiation. Yes Bank will only agree to settle if they are convinced that your inability to pay is genuine and not willful. Here are the common grounds for eligibility:
If you have lost your job due to layoffs, company closure, or resignation and have been unemployed for a significant period, you can apply for settlement.
Entrepreneurs facing severe losses, bankruptcy, or closure of business operations can use their financial statements to prove hardship.
Severe illness, hospitalization of self or family members that has drained your savings and income capacity is a valid ground for settlement.
Loss of a primary earning member in the family or legal separation affecting household income can be presented as a reason for settlement.
If you have the funds but are choosing not to pay, Yes Bank will not settle. They may instead initiate strict legal action against you.
We review your documents to prove genuine financial hardship.
We inform Yes Bank of our representation to stop harassment.
We draft and submit a realistic settlement proposal to the bank.
Our lawyers negotiate hard to get the maximum possible waiver.
You pay the settled amount and get the No Dues Certificate.
The process starts with you providing us with your loan details and proof of hardship. We analyze your financial standing to determine the maximum amount you can afford to pay and the minimum amount the bank is likely to accept.
Harassment is the biggest pain point. We issue a formal "Letter of Representation" to Yes Bank. This legal document states that you have appointed us as your legal counsel. Under RBI guidelines, once a lawyer is appointed, recovery agents must direct their communication to the lawyer, not the borrower. This gives you immediate relief.
We don't just ask for a settlement; we present a case. We draft a professional proposal highlighting your inability to pay due to specific reasons (job loss, medical issues) and offer a settlement amount. This is done in writing to create a paper trail.
Yes Bank will likely reject the first offer or counter with a high amount. This is where our experience counts. We engage in multiple rounds of negotiation with the bank's credit managers, citing legal precedents and your financial reality to bring the amount down.
Once a figure is agreed upon, Yes Bank issues a Settlement Letter. We verify this letter to ensure it contains no hidden clauses. You make the payment directly to your loan account (never to an agent). Finally, we follow up to ensure you receive the No Dues Certificate (NDC), officially closing the loan.
To convince the bank, we need to prove your financial distress. Having these documents ready speeds up the process.
If you default, Yes Bank may send various legal notices. Ignoring them is dangerous. Here is what they mean and how we handle them.
Issued for Cheque Bounce or ECS failure. This is a criminal offense in India.
Our Action: We reply immediately, attend court hearings if needed, and push for an out-of-court settlement to quash the case.
Issued for Secured Loans (Home/Property). It warns of asset seizure.
Our Action: We file objections, approach the DRT (Debt Recovery Tribunal) if necessary, and negotiate to save your property.
Notice to resolve the dispute through an arbitrator appointed by the bank.
Our Action: We represent you in arbitration proceedings to ensure the award is fair and not one-sided.
Many borrowers confuse these two options. Here is a clear comparison to help you decide.
| Feature | Loan Restructuring | Loan Settlement (OTS) |
|---|---|---|
| What is it? | Changing terms (tenure/EMI) to make repayment easier. | Closing the loan by paying a reduced lump sum. |
| Total Payment | You pay the full principal + interest (often more over time). | You pay significantly less (20-50% savings). |
| Credit Score | Less impact. Shows as "Restructured". | Negative impact. Shows as "Settled". |
| Best For | Temporary cash flow issues but intent to pay full. | Severe financial crisis with no hope of full repayment. |
| Closure | Loan continues for years. | Immediate closure and freedom from debt. |
Settlement will mark your account as "Settled" in CIBIL, dropping your score by 50-100 points. This is a trade-off for becoming debt-free.
It stops the "Days Past Due" counter. You can rebuild your score to 750+ in 12-24 months using secured credit cards. We provide a post-settlement credit repair guide to all our clients.
We know Yes Bank's internal settlement policies, hierarchy, and approval limits, giving us an edge in negotiations.
We are lawyers, not agents. We can handle legal notices and represent you in Lok Adalats if needed.
Once we step in, recovery agents are legally bound to talk to us, not you. We take the stress off your shoulders.
"I had a personal loan of 8 Lakhs with Yes Bank and lost my job. The recovery agents were calling my relatives. AMA Legal Solutions took over, stopped the calls, and settled the loan for 3.5 Lakhs. I am forever grateful."
Vikram Singh
Software Engineer, Pune
"My credit card bill had ballooned to 4 Lakhs due to interest. I was paying minimum due but the principal never decreased. AMA negotiated a one-time payment of 1.2 Lakhs. Professional and transparent service."
Anjali Mehta
Small Business Owner, Mumbai
The Yes Bank loan settlement process, often involving a One-Time Settlement (OTS), allows borrowers who are unable to repay their full debt due to genuine financial hardship to close their loan account by paying a reduced lump-sum amount. This is a legal process where the bank agrees to waive a portion of the interest and principal to recover the remaining dues.
Yes, Yes Bank offers One-Time Settlement (OTS) schemes for personal loans, especially for accounts that have become Non-Performing Assets (NPAs). The settlement amount depends on the borrower's repayment capacity, the duration of the default, and the bank's internal policies at the time of negotiation.
In a Yes Bank credit card settlement, borrowers can typically negotiate a waiver of 30% to 60% of the total outstanding amount. The final percentage depends on the severity of the financial hardship, the age of the debt, and the negotiation skills employed. Penalties and accumulated interest are often the first components to be waived.
Yes, settling a loan will impact your CIBIL score. The account status will be reported as 'Settled' instead of 'Closed', which indicates that the loan was not paid in full. This can lower your score by 50-100 points. However, it is a better alternative to a 'Written Off' status, and you can rebuild your score over time with disciplined financial behavior.
To initiate a settlement with Yes Bank, you typically need to submit a settlement proposal letter along with documents proving your financial hardship. These may include recent bank statements, salary slips (showing pay cuts or job loss), medical records (if applicable), and income tax returns. Identity and address proofs are also required.
While the initial request or proposal can sometimes be sent via email or through the bank's portal, the negotiation and finalization of the settlement usually require direct interaction with the bank's recovery department or authorized officers. It is highly recommended to have a legal expert handle these communications to ensure the terms are fair and documented correctly.
The entire process, from submitting the proposal to receiving the settlement letter, typically takes between 30 to 90 days. This timeline can vary based on the complexity of the case and the speed of the bank's internal approvals.
A 'No Dues Certificate' (NDC) or 'No Objection Certificate' (NOC) is a formal document issued by Yes Bank after you have paid the agreed settlement amount in full. It certifies that the loan account is closed and the bank has no further claims against you. This is a crucial document to prove you are debt-free.
Once a settlement is legally finalized, the payment is made, and the No Dues Certificate is issued, Yes Bank cannot restart legal action for the same debt. However, if you fail to pay the settlement amount within the agreed timeframe, the settlement becomes void, and the bank can resume legal proceedings for the full outstanding amount.
While not mandatory, hiring a lawyer is strongly advised. A lawyer can protect you from harassment by recovery agents, ensure that the settlement terms are legally sound, and negotiate a better deal than you might achieve on your own. They also ensure that all documentation, including the settlement letter and NDC, is in order.
Our loan settlement services are available across all states and union territories in India