Centre may amend Sarfaesi Act to control Central Registry

The Union government is considering a set of amendments to the Sarfaesi Act, 2002 to remove legal ambiguities, strengthen oversight of the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (Cersai), and improve ease of doing business, according to sources familiar with the matter.

- HARSH KUMAR

The Sarfaesi (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) Act provides an enabling legal framework for banks and financial institutions to recover dues exceeding ₹1 lakh by enforcing security interests against the borrower's or guarantor’s secured assets without court or tribunal intervention.

Cersai is a central online database created by the Indian government to record security interests (mortgages/charges) over properties, preventing fraudulent multiple lending on the same asset by storing details of loans against immovable, movable, and intangible assets, increasing transparency in lending, and ensuring lenders can verify prior encumbrances.