| The Indian Banks' Association, in its representation to the finance minister, has asked for amendments, including allowing of appeal to Debt Recovery AppellateTribunal (DRAT), if the borrower deposits 75 per cent of the amount owed. | |
| The IBA also wants the Securities & Exchange Board to regulate the securitisation process. At present, the Reserve Bank of India is the regulator. | |
| The IBA wants the insertion of a clause specifying the role and extent of the jurisdiction of the DRTs and DRAT since it perceived that the present provisions are silent on the issue. | |
| To prevent the abuse of the right of appealing to DRAT, a provision should be introduced to empower the tribunal to award damages to banks in case borrower knowingly makes wrong statements to delay payments. Secured creditors should be able to issue direction to tenants of property taken over by creditors, to deposit the rent with them, IBA has said. | |
| Though the Sarfaesi Act empowers asset reconstruction companies to take over management , it does not provide for issue of any notice and compliance of other procedures. | |
| The IBA has said that the clause should be linked to another section of the law which lay down the procedures to be adopted. It has also sought a clarification on powers related to management contol. | |
| The IBA has also sought review of the provisions related to ARCs, which are not allowed benefits enjoyed by financial institutions and housing finance companies at present. | |
| It has also suggested that investors, without any interest in the bank or FI whose assets are being acquired be permitted more equity. Some foreign investors have evinced interest subscribing to the entire paid-up capital of ARCs. | |
| IBA has said that the section which has brought under the jurisdiction of the DRT, cases involving more than Rs 1 Lakh instead of earlier Rs 10 lakh, should be removed.
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