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Classifying fraud a/c: RBI issues circular
July 16, 2024
|The New Indian Express
FOLLOWING the March 2023 Supreme Court judegment on classifying an account/borrower as fraud, the Reserve Bank has incorporated certain changes to ensure "natural justice to the borrower" and has issued a new master circular detailing essential measures to that all lenders--commercial banks, non-banks, housing financiers and all cooperative banks --have to adhere to before classifying fraud accounts.
In an order on March 27, 2023, the court upheld the petition that sought natural justice and directed the banks to give time and offer detailed explanation the borrower and also asked the RBI to issue new directions towards the same.
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