Kolkata, New Delhi, INDIA. New York, USA.
Business To Business, Mumbai, 16th July, 2026: The Reserve Bank of India (RBI) on Thursday clarified that banks acquiring an immovable asset as part of a loan recovery process in exceptional cases cannot sell the property back to the defaulting borrower or any related party.
Banks are generally not expected to own non-financial assets as part of their regular lending operations. However, in exceptional circumstances where a loan turns non-performing and legal or contractual recovery measures are initiated, lenders may acquire ownership of an immovable property that was offered as collateral security as part of the recovery strategy.
The RBI said such assets must not be transferred back to the borrower or entities related to the borrower, reinforcing safeguards in the recovery process.