RBI to tighten norms for wilful defaulters
New Delhi, September 21
The RBI on Thursday issued a new draft on action against wilful defaulters that includes publishing their photographs and broadening the definition of wilful defaulters as someone who has an outstanding amount of Rs 25 lakh and above and has refused to repay despite having the capacity to pay.
The new draft was aired following criticism from bank unions, the opposition and other stakeholders of its June 8 circular. It was alleged that the RBI had diluted penal measures for wilful defaulters. Even the borrowers had asked for clarity and a proper procedure for declaring them as wilful borrowers.
The RBI said it has sought comments on the new draft master direction that proposes to expand the scope for lenders which can classify borrowers as wilful defaulters, and refine the identification process. The draft also proposes to bar wilful defaulters from the restructuring of credit facility and the Board of any other company.
Proposals on cards
- The draft proposes to bar wilful defaulters from the restructuring of credit facility and the Board of any other company
- Review of wilful default aspects within six months of an account being classified as NPA
