In a circular issued on Sunday, the BB wanted the banks to recover at least 1.0 per cent of their respective NPLs through ADR.
The central bank has mentioned that the relevant law attaches increased importance to the application of ADR mechanism for speedy recovery of NPLs and settlement of disputes outside the court of law. The law in question also stipulates that parties concerned can settle disputes through the ADR mechanism with the permission of the court before the latter delivers verdict or order at any stage of the case.
Once mediation is not successful, the circular said, both parties are free to go for arbitration. To make it happen, the banks can sign memorandum of understanding (MoU) with the BIAC or similar other entities, the BB circular adds.
NPL recovery
Banks can avail services of BIAC or the likes for ADR
FE REPORT | Published: May 14, 2024 00:24:55
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