Debt Recovery Services

Enforcement Agent under Sarfaesi Act

The Company specializes in undertaking outsourcing of entire procedure and legal actions as laid down under Chapter III of THE SECURITISATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTEREST ACT, 2002 (in short referred to as SARFAESI ACT) and THE SECURITY INTEREST ENFORCEMENT RULES, 2002. The Chapter III of SARFAESI Act deals with the second part of the act i.e. ENFORCEMENT OF SECURITY INTEREST (Sections 13 to 18A of the SERFAESI ACT, which deals with the procedures for issuing demand notices; taking symbolic and physical possession of the secured assets; valuation and sale of secured assets; procedure of sale; and security and management of the secured assets, etc.

Recovery Agent :

Recovery Agent As recovery agents we work for a bank or a financial institution, engaged in recovering debts from defaulting customers across different kinds of loans, mortgages, etc.

Other responsibilities we undertake are:

  • Trace customers who've moved away from recorded locations, without any forwarding address or trace left behind. This activity is known as "skip-tracing".
  • For customers who are unable to make payments, we are authorized to offer some amount of waivers or easy debt repayment plans.
  • Maintaining detailed records of calls/visits made, payments or promises to make payments, new contact details, etc.
Auction & Sale

Auction & Sale The Company is also providing services as Auctioneers and Agents facilitating sales of secured assets seized by the lenders. The Company has compiled a large database of persons interested in making the investments in assets on distress sale. The following procedure is adopted for faster sale and better realization of value of assets:

  • Drafting and publication of legal notices as prescribed under SARFAESI Act with all requisite particulars
  • Information is sent to relevant part of the database regarding the property/asset on sale
  • The properties/assets are also listed for sale on popular media- both print and electronic media
  • The properties/ assets of sale are publicized locally by way of banners, inserts and dealers
  • The interested buyers are persuaded and visits to the properties/ inspection of the assets are arranged
  • Proper auction proceedings are conducted and all necessary records and evidences are kept for future references and authentication
  • Preparation of all documents, legal formalities etc. after successful closure of the auction
  • Complete all the documentation for transfer of title in favour of the buyer and drafting and facilitating issue of sale certificate
  • The Company has to its credit more than successful auctions and sales. There is a dedicated team for management, publicity and marketing of assets under distress sale. The team is experienced enough to handle properties of any size. The documentation process has already been optimized and systemized resulting in better confidence of buyers, timely completion of transaction and faster recovery of dues.
Debt Resolution Services :

The need for OTS arises due to the fact that whenever the recovery proceedings are initiated and legal notices are issued to recover dues from the defaulting borrowers, the defaulters in most of the cases obtain different kinds of stay orders from different Courts and the matter remains pending for a long time. During this period the lenders are not able to recover their interest/principal dues from such borrowers as the matter remains subjudice. In order to improve the recovery from all such cases and also from the chronic defaulters and in order to reduce the Non Performing assets (NPAs), the mechanism of OTS of dues was evolved. There is an increase in tendency from banks to prefer one time settlement (OTS) as against enforcement of security interest or recovery through legal route. The trend is gaining momentum because of the tardy legal process involved. Objectives of OTS The Scheme aims at One Time Settlement with the MSME NPA borrowers, where the exposure of the Bank is not more than Rs.25 lacs per borrower, to ensure speedy settlement of the accounts without going into long drawn recovery process.

RBI OTS Policy

NPA Management of Banks One-Time Settlement/Compromise Schemes
Subsequent to the introduction of the SARFAESI Act, 2002, the Reserve Bank issued fresh guidelines for one-time settlement scheme in January 2003 for compromise settlement of chronic NPAs up to Rs.10 crore in PSBs. These guidelines cover: (a) all NPAs in all sectors, irrespective of the nature of business, which have become doubtful or loss assets as on March 31, 2000 with outstanding balance of Rs.10 crore and below on the cut-off date; (b) NPAs classified as sub-standard as on March 31, 2000, which have subsequently become 'doubtful' or 'loss' assets; and (c) cases in which the banks have initiated action under the SARFAESI Act, 2002 and also cases pending before Courts/Debt Recovery Tribunals (DRTs)/Board for Industrial and Financial Reconstruction (BIFR), subject to consent decree being obtained from the Courts/DRTs/ BIFR. The last date for receipt of applications from borrowers under the scheme is September 30, 2003. Guidelines for the special One-Time Settlement (OTS) scheme for loans up to Rs.50,000 to small and marginal farmers by PSBs were operative up to December 31, 2002. They were extended up to March 2003 in view of requests received from banks and the drought/flood situation in various parts of the country.

Supporting Agency :

The Company also provides specialized services to banks and other financial institutions to which the SARFAESI Act is applicable. These services could be one or a combination of services as required under the SARFAESI Act. The company is providing these services to different Banks, which has empanelled our company as 'Supporting Agency'.