Don’t miss the latest developments in business and finance.

RBI issues Master Direction on treatment of Wilful Defaulters and Large Defaulters

Image
Last Updated : Jul 31 2024 | 12:31 PM IST

The RBI yesterday issued a Master Direction on the Treatment of Wilful Defaulters and Large Defaulters under which banks and NBFCs will have to examine the 'wilful default' aspect in all non-performing asset accounts with outstanding amounts of Rs 25 lakh and above. The provisions regarding reporting and dissemination of credit information pertaining to large defaulters shall apply to all entities regulated by the Reserve Bank, irrespective of whether they fall within the definition of 'lender' as provided in these Directions or not. All entities regulated by the Reserve Bank, including 'lenders', shall submit information to all credit information companies (CICs) in respect of the large defaulters at monthly intervals - a list of suit filed accounts of large defaulters; and a list of non-suit filed accounts of large defaulters whose account has been classified as doubtful or loss (in accordance with the instructions issued by the Reserve Bank from time to time).

For calculating the threshold of Rs 1 crore, the unapplied interest, if any, shall also be included. In the case of suit-filed accounts, the threshold shall relate to the amount for which the suits have been filed. The central bank noted that wilful defaulter' means a borrower or a guarantor who has committed wilful default, and the outstanding amount is Rs 25 lakh and above. Large defaulter" means a defaulter with an outstanding amount of Rs 1 crore and above, and where suit has been filed; or whose account has been classified as doubtful or loss (in accordance with the instructions issued by the Reserve Bank from time to time).

Powered by Capital Market - Live News

Disclaimer: No Business Standard Journalist was involved in creation of this content

More From This Section

First Published: Jul 31 2024 | 12:21 PM IST

Next Story