No Due Certificate from the Bank: Format and Sample Letters

A no due certificate from the bank is a formal letter stating that a person has cleared all their dues and has done the full and final settlement of money. A no-due certificate from the bank is only issued after an individual has cleared all the dues. It is a legal document issued by a bank to a customer declaring that he/she has no outstanding dues towards the lender. No Dues Certificate can be obtained from the bank once the loan has been paid off completely.

One must obtain a no-due certificate from the bank once they have paid off all the amount of the loan. A no dues certificate from the bank dissolves all the power of the bank on the collateral. After closing the loan you are required to get a no-due certificate, which acts as proof that you have paid all the balance loan amount. This letter will be retained by the person as an official note that he/she owes nothing more to the lender/bank as far as the loan transaction is concerned.

If the borrower does not have a No Due Certificate (NDC) from the lender, they cannot prove that they are free of obligation to any entity including other banks. Usually, the bank issues a no-due certificate after payment of the loan by the customer. But, in case it is not issued by the bank the customer needs to write a formal letter to the bank asking for the issuance of the same.

No due certificate from the bank

No Due Certificate from the Bank: Guidelines and Tips

A no due certificate letter should be written following the format of a formal letter.
As an official letter, the matter should be brief and to the point.
It is important to mention the correct date for the bank to note down your date. It also acts as proof that you have written to the lender on a particular date.
The subject should be precise and a single line telling the purpose of your letter.
Add a formal and respectful salutation for the receiver.
The main body should contain an introduction, the purpose of writing, and the bank details needed for the procedure.
Mention in the letter, if you have attached some verification documents in the end.
End the letter with a sense of gratitude towards the receiver, as we are making a request for the issuance of a due certificate.
Senders should provide the contact details if needed for the process or in case of any query.
Proofread the letter before sending it.

Format of a No Due Letter from the Bank

When written from the point of view of a customer:

Sender’s address

Date: (dd/mm/yyyy)

Receiver’s address

Subject

Salutation

Body of the letter

Thank you.

Yours sincerely/faithfully/truly

Sender’s name

Contact details

Attachments: (if any)

When written from the point of view of the issuer:

Date: (dd/mm/yyyy)

Receiver’s address

Subject:

To whoever this may concern

Body of the letter

Sincerely/faithfully/truly

Sender’s address

Designation

Sample of a No Due Certificate 1 – From the point of view of a Customer

11, Shiv complex

Satyam Vihar

Mahanpur

Delhi

Date: 14/04/2022

The Branch Manager

ICICI Bank

Shubh Vihar,

Main Road Branch

Delhi

Subject: Issuance of No Due Certificate

Respected Sir,

I am Sakshi Dubey, and I have a personal loan in my account in your bank. I am writing this letter to request you to issue a no-due certificate for my personal loan account with the number 83866282626.

I have cleared all of my EMIs, and the loan tenure is complete. I am attaching all the mentioned documents, including the Payment Receipts, Loan Sanction Documents, and a copy of my Aadhaar Card and PAN Card as per the requirements of the bank with this letter.

Kindly do the needful and let me know the further procedure for the closure of the loan. Please contact me on the number provided below in case of any queries. I would be grateful if you could do the process at the earliest.

Thank You.

Sincerely,

Sakshi Dubey

Contact number: 738263628282

Attachments:

Loan A/c number.
Loan payment receipts
Aadhar Card copy
PAN Card copy

Explore More Sample Letters

Sample of a No Due Certificate 2 – From the point of view of the Bank

Date: 30/04/2022

Sakshi Dubey,

11, Shiv complex

Satyam Vihar

Delhi

Subject: No due certificate for Personal Loan

To whoever this may concern,

This is to certify that Ms Sakshi Dubey, has been a holder of a personal loan account in our bank for the past 3 years. The loan amount of Rs.10 lakhs has been settled by her against loan account number 83866282626 and there are no more pending dues against her.

Sincerely,

Madan Shah

The Branch Manager

ICICI Bank

Shubh Vihar,

Main Road Branch

Delhi

FAQs about No Due Certificate from Bank

Question 1. What is a no-due certificate from the bank?

Answer. A no-due certificate from the bank is a formal letter stating that a person has cleared all their dues and has done the full and final settlement of money. It is a legal document issued by a bank to a customer declaring that he/she has no outstanding dues towards the lender.

Question 2. Is a no-due certificate essential?

Answer. Yes and no due certificate is very essential for both the parties i.e. lender and customer. One must obtain a no-due certificate from the bank once they have paid off all the amount of the loan. This letter will be retained by the person as an official note that he/she owes nothing more to the lender/bank as far as the loan transaction is concerned. If the borrower does not have a No Due Certificate (NDC) from the lender, they cannot prove that they are free of obligation to any entity including other banks.

Question 3. How is a no-due certificate from the bank helpful?

Answer. A no-due certificate helps to: