What changed
RBI issued a circular on November 22, 2005, directing financial institutions (Exim Bank, IDFC, IFCI, IIBI, NABARD, NHB, SIDBI, TFCI) to uniformly implement the OTS scheme for SME accounts, as per the enclosed RPCD circular dated September 3, 2005.
What it means for you
FIs must now apply the same OTS guidelines to SME accounts, promoting consistent resolution of stressed assets.
What you must do
- Review the enclosed RPCD circular dated September 3, 2005, for detailed OTS guidelines.
- Update internal SME loan recovery policies to match the uniform OTS framework.
- Train staff on the new OTS process to ensure consistent implementation across branches.
- Acknowledge receipt of the circular to RBI as instructed.
Who it affects
All-India term-lending and refinancing institutions (Exim Bank, IDFC Ltd., IFCI Ltd., IIBI Ltd., NABARD, NHB, SIDBI, TFCI Ltd.)
Which institutions are covered by this OTS scheme?
The scheme applies to all-India term-lending and refinancing institutions listed: Exim Bank, IDFC Ltd., IFCI Ltd., IIBI Ltd., NABARD, NHB, SIDBI, and TFCI Ltd.
Does this OTS scheme differ from the one for public sector banks?
The source states FIs should uniformly implement the same guidelines issued to public sector banks, as applicable.
What is the effective date of this circular?
The circular was issued on November 22, 2005, and FIs were expected to implement it immediately upon receipt.