Originally posted on July 22, 2014, and updated on 15, March 2023 Generally speaking, a lien (positive lien) is merely a right of a person to retain a property that is in his possession but belongs to another person till such time the debt or other obligation (for which such lien is conferred) is discharged.…
Dealing with accounts of mentally ill or lunatic or insolvent persons remains a delicate job for bankers. Whenever bankers learn that one of their customers is incapable of operating the account due to mental incapacity the operation of such a customer’s account shall be immediately suspended. While dealing with such accounts, bankers need be to…
The main concern of a bank is that security available to it should be good enough to fall back upon, in the event of adverse circumstances. The role of loan documentation in the bank is to establish a legal relationship between the lender and the borrower when the dispute goes to a court of law.…
The article explains various types of charges created by banks to establish their rights over the specified security when the borrower defaults. The charge creation means establishing the lender’s right to recover from the specified assets of the borrower, in case the recovery is difficult in the normal course. The mode of bank charge on…
(This article gives the details like rights of secured creditors, Application of mind and care is required in the service of notice of SARFAESI DEMAND NOTICE, POSSESSION NOTICE & SALE NOTICE, Special care to be taken while taking possession of movable properties, method of sale of secured property by way of inviting tenders from the public or by…
In the statement on Developmental and Regulatory Policies dated February 8, 2023, the Reserve Bank of India (RBI) announced today that the central bank will start a pilot project to launch QR code based coin vending machines. Unlike cash-based traditional Coin Vending Machines, the QCVM is a coin dispensation machine that would eliminate the need…
The six-member Monetary Policy Committee (MPC) headed by RBI Governor on Wednesday (February 8, 2023) announced the hike in the repo rate by 25 basis points to 6.50%. The RBI also projected India’s GDP growth at 6.4 per cent for 2023-24 and projected retail inflation at 6.5 per cent for 2022-23 and 5.3 per cent…
As per the current guidelines, Securitisation is allowed only in the case of standard assets while lenders have to largely rely on Asset Reconstruction Companies (ARCs) for bad assets. Based on market feedback, stakeholder consultations, and the recommendations of the Task Force on Development of Secondary Market for Corporate Loans, RBI decided to introduce a…
(This post elucidates the entire process of creation of charge or modification of charge and satisfaction of charge and the requirement of information in the form of a resolution passed in the Board meeting) According to Section 77 of the Companies Act, every company that creates a charge shall register the same with the Registrar…
The Reserve Bank of India on Monday released the draft guidelines for banks to make provisions on an expected credit loss (ECL) basis as against the current framework of incurred loss method. It means banks have to shift away from the current method – where loan loss provisions are made after a default – to…