ARCs Must Establish a Board-Approved Policy Covering Settlement Eligibility, Sacrifice Limits, & Security Valuation Methods
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- Last Updated on 22 January, 2025
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Circular No. RBI/2024-25/106 DoR.SIG.FIN.REC.56/26.03.001/2024-25; Dated: 20.01.2025
The RBI has notified an amendment to Para 15 of the Master Direction on Asset Reconstruction Companies, which pertains to the ‘Guidelines on Settlement of Dues of Borrowers by ARCs. Now, every ARC shall frame a Board-approved policy for the settlement of dues payable by the borrowers. This policy shall cover aspects such as the cut-off date for One-Time Settlement eligibility, permissible sacrifice for various categories of exposures, and methodology for arriving at the realisable value of the security.
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