Banks opt to go slow on training recovery agents

Only 25 recovery agents have been certified by the Indian Institute of Banking Finance (IIBF) - the entity mandated by the regulator to conduct exams for a certification programme - despite a Reserve Bank of India directive to get them to undergo training.

While there are no firm estimates available, bank executives said that there are nearly 100,000 agents and bank executives involved with the recovery process.

Instead of training executives at a time when delinquency rates are rising across segments, lenders have approached industry body Indian Banks’ Association (IBA) and IIBF to lower the fees, which are in the range of Rs 6,000-8,000 for every agent. Bankers said they were finding it difficult to keep employees and agents away from work for 15 days when they undergo the 100-hour training and certification programme mandated by the central bank.

An IIBF functionary said, “In June, the certification agency had issued around 25 certificates, while a second test for 80 people is scheduled for later this month. There are around 100,000 recovery agents in the market.”

On their part, banks said the pace of training is gathering momentum. Many banks such as ICICI Bank, HDFC Bank and ABN Amro are conducting in-house training programmes for their agents, who will later write the IIBF-conducted examination. Public sector lender Bank of Baroda has also received IBA’s recognition for an in-house training institute. By the end of the quarter, BoB intends to train around 40 agents.

IIBF has also tied up around 50 agencies across the country to step up the training process. In order to speed up the process and get more people to undergo training, the medium of instruction and writing is being expanded from English and Hindi to nine other Indian regional languages, the institute’s functionary said.