Finance Ministry conducted meeting of Banks, Check important decisions taken in meeting

On Saturday, the Finance Ministry called on banks to establish stronger monitoring and oversight mechanisms for managing cases in Debt Recovery Tribunals (DRTs). This move aims to improve the efficiency of handling pending cases and ensure faster recovery of funds.

The meeting, chaired by Financial Services Secretary M. Nagaraju, included discussions with chairpersons of Debt Recovery Appellate Tribunals (DRATs) and Presiding Officers of DRTs. The focus was on sharing and adopting best practices across all DRTs to enhance outcomes. The goal is to streamline the recovery process and reduce the backlog of cases. The meeting was attended by senior officers from the public and private sectors banks, Deputy Chief Executive Officer (CEO), Indian Bank Association (IBA) and senior officers from the Ministry of Finance.

Decisions taken in meeting:

• Banks to put in place effective monitoring and oversight mechanism for efficient management of pending cases in DRTs
• Some of the best practices followed in DRTs were also discussed which can be adopted across DRTs for better outcome.
• Banks to have clearly defined policy for small and high value cases pending in DRTs for optimising the recovery.
• While formulating settlement policy, banks to take into account the transaction costs in mind while pursuing pending recovery cases.
• All stakeholders to work collectively to reduce pendency and take effective measures for optimisation of recovery which would help in ploughing back the capital stuck in pending cases to the economy for productive use.
• DRT Regulations 2024 which have number of improved features over the earlier DRT Regulation 2015 to be adopted by all DRTs with an objective to make the DRT process more effective and less time consuming.

Conclusion

The Finance Ministry’s push for better oversight and the adoption of best practices is a step towards resolving pending debt recovery cases more efficiently. By implementing these measures, banks can help release capital stuck in legal disputes and contribute to the country’s economic growth. The adoption of the new DRT Regulations 2024 is expected to further streamline the process, ensuring quicker resolutions and better outcomes for all parties involved.