Categories: Banking

RBI grants license to NARCL under Sarfaesi Act

The Reserve Bank of India (RBI) has granted the National Asset Reconstruction Company (NARCL) the licence to register as an asset reconstruction company (ARC). The Licence is given under Section 3 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act 2002.

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As per Section 3 of the SARFAESI Act, a company can carry the business of asset reconstruction only after obtaining a certificate of registration from RBI and, having the owned fund of not less than Rs 2 crore or such other amount not exceeding 15% of total financial assets acquired or to be acquired by the securitisation company or reconstruction company. The NARCL has been incorporated under the Companies Act, and public sector banks will hold 51 per cent in NARCL.

Important takeaways for all competitive exams:

  • RBI 25th Governor: Shaktikant Das; Headquarters: Mumbai; Founded: 1 April 1935, Kolkata.

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Sumit Arora

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