The Reserve Bank of India has said banks should ensure that loan defaulters are not put to embarrassment while debts are recovered.
Participating in a two-day workshop on ‘Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002’ , RBI’s Principal Legal Adviser G S Hegde said the Act allowed banks to auction properties when borrowers failed to repay the loan. It helped them reduce non-Performing assets.
However banks should engage trained agents to recover the money, he said, adding it was important to deal with debtors with ‘humaneness’.
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