 "Better protection for depositors and investors was one of the chief considerations in Union Finance Minister Nirmala Sitharaman introducing, on Friday, the Banking Laws (Amendment) Bill, 2024, in the Lok Sabha to amend four pieces of legislation.")
Punjab National Bank (PNB), the country’s second-largest state-owned lender, said earlier this month that it has identified more than 100 loan accounts worth about Rs 4,000-5,000 crore for sale as non-performing assets (NPA) to recover money.
Banks and financial institutions employ several legal mechanisms to recover money. The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act, 2002 allows them to act on NPAs without court intervention. Debt recovery tribunals (DRTs) enable faster resolution compared to civil courts. Selling bad loans to asset reconstruction companies (ARCs) is another way to recoup losses from bad loans.
