RECOVERY OF LOANS
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Retail Banking and Wealth Management — JAIIB.
One-liners from this chapter
Free sample — 8 of 66 rapid-fire Q&A cards.
What is the primary legal framework governing the recovery of dues by banks in India through special tribunals?
The Recovery of Debts Due to Banks and Financial Institutions (RDDBFI) Act, 1993 established Debt Recovery Tribunals (DRTs) for expeditious recovery of dues above Rs. 20 lakh.
What is the minimum threshold for banks to file recovery cases before a Debt Recovery Tribunal (DRAT)?
Cases above Rs. 20 lakh are eligible for DRT filing.
Under SARFAESI Act 2002, what is the minimum outstanding loan amount for a secured creditor to invoke the Act?
The SARFAESI Act can be invoked when the outstanding loan amount is Rs. 1 lakh or more and the loan is classified as a Non-Performing Asset (NPA).
What does the term 'secured creditor' mean under the SARFAESI Act 2002?
A creditor holding a security interest over any property of the borrower.
What is the notice period a bank must give to a borrower before taking possession of secured assets under SARFAESI Act?
Banks must issue a 60-day demand notice to the borrower before taking possession of secured assets under Section 13(2) of the SARFAESI Act.
What is meant by 'securitisation' of loans in the context of NPA management?
Converting loan assets into marketable securities for sale to investors.
What is the meaning of 'NPA' in retail banking loan recovery context?
NPA stands for Non-Performing Asset, where a loan account is classified as NPA when interest or principal remains overdue for more than 90 days for term loans.
Under the SARFAESI Act, what is the maximum time period for redemption of mortgaged property by the borrower?
Borrower can redeem the property before the actual date of sale.
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