What changed
RBI has mandated that all regulated entities acting as secured creditors under SARFAESI Act, 2002 must display information on their website about borrowers whose secured assets have been taken into possession. The disclosure must follow a prescribed format and be updated monthly, with the first list due within six months of the circular date.
What it means for you
Banks and lenders must now publish borrower-level data on possessed assets, increasing transparency but also operational burden. This may affect borrower privacy concerns and require system changes to generate and update the prescribed format monthly. Non-compliance could invite regulatory scrutiny.
What you must do
- Prepare to upload the first list of possessed assets on your website within six months from September 25, 2023.
- Set up a monthly update mechanism for the SARFAESI possession data in the prescribed format.
- Coordinate with legal and IT teams to ensure accurate data fields including borrower/guarantor details, outstanding amount, asset classification, and title holder.
- Review current possession records to ensure completeness before the first upload.
Who it affects
All Commercial Banks including Small Finance Banks, Local Area Banks, RRBs, All Primary (Urban) Co-operative Banks, State Co-operative Banks, Central Co-operative Banks, All India Financial Institutions (Exim Bank, NABARD, NHB, SIDBI, NaBFID), All NBFCs including Housing Finance Companies, All Asset Reconstruction Companies
What is the deadline for the first upload?
The first list must be displayed on the RE's website within six months from the circular date, i.e., by March 25, 2024.
What data fields are required in the disclosure?
The prescribed format includes branch name, state, borrower name, guarantor name (if applicable), registered addresses, outstanding amount, asset classification, date of classification, details of security possessed, and name of title holder.
Does this apply to Payment Banks?
No, Payment Banks are explicitly excluded from this circular.