Duties in Charge of Banks

How the bank may discover the misuse of the loan, are the credit institutions attentive enough to this issue?

Александр  Alexander Falev
In corporate lending the use of funds is reflected in agreements, appropriate documents are signed proving the purposeful use of funds and sanctions are foreseen for violation.

In retail lending, the business processes initially are organized in such a way that the target funds is simply cannot be used for other purposes. A striking example - car loans when cash immediately after the issue are disbursed to the car dealer.
Елена  Yelena Rechkalova
Bank, Adviser to the Chairman of the Board of Directors
To track the purposeful use of funds in cash is rather difficult: for that the banks request the borrowers to provide them the receipts confirming the use of funds. But in this case it is necessary to stress once again that if the client is not a cheater, he shall be interested in providing the bank with the relevant documents (to avoid the credit organization raising his rate on the loan).
Алла  Alla Soldatova
Eastern Express bank, Director for quality and service
As a rule, the target loan is initially disbursed by the bank upon provision of supporting documents, or requires them to provide for some well-defined period.