Mr. Sudhir, an entrepreneur aiming to grow his small-scale business, sought a loan from ABC Financial Institution. The loan, once approved, had to be formalized into an agreement stamped as per the Indian Stamp Act, creating a legally enforceable document, valid as evidence in court if required.
Previously, finalizing a loan agreement involved the cumbersome process of purchasing physical stamp paper and writing the agreement on it. However, ABC Financial Institution chose to revolutionize this process by opting for e-stamping, aiming to enhance efficiency and security.
To facilitate e-stamping, the legal department of ABC Financial Institution approached ABC Bank of India, an Authorized Collection Center (ACC) for e-stamping. The bank official used the loan agreement details to calculate the payable stamp duty based on the loan amount and guided the team in making an online payment via the e-stamping portal of SHCIL (Stock Holding Corporation of India Limited).
Upon payment confirmation, an e-stamp certificate was instantly generated. This certificate, a digital equivalent of the physical stamp paper, bore a unique identification number (UIN), the date, the stamp duty amount, and the loan agreement details. The loan agreement was subsequently drafted on this e-stamp certificate.
In choosing e-stamping, ABC Financial Institution realized several key advantages:
- Efficiency: E-stamping eliminated the time-consuming process of acquiring physical stamp papers and enabled instant generation of the e-stamp certificate, significantly accelerating the loan disbursal process.
- Security: The UIN on the e-stamp certificate ensured its authenticity and safeguarded against any possible fraud or tampering.
- Flexibility: Unlike traditional physical stamp papers, e-stamping allows payment of the exact amount of stamp duty, eliminating worries over obtaining the correct denominations.
In conclusion, this use case highlights how e-stamping can significantly streamline the loan agreement process in the financial sector. It not only simplifies the procedure but also bolsters security and flexibility. As the financial sector continues its journey of digitization, integrating practices like e-stamping proves advantageous, enabling the delivery of efficient and secure services to customers.
Interested in learning more about how e-stamping can revolutionize your financial transactions? Get in touch with us today and we’ll help you navigate the fast, secure, and efficient world of e-stamping in India.