"(BUSINESS STANDARD) Debt recovery tribunals: More pain than gains for banks- Experts suggest that the law should be strengthened to ensure mandatory time bound disposal of cases • The functioning of debt recovery tribunals (DRTs), created to help financial institutions recover dues speedily without being subjected to the lengthy procedures of usual civil courts, appears to cause more pain than gain for banks. • “The functioning of DRTs needs to improve to ensure banks are able to recover their existing loans and offer fresh advances at cheaper rates. • In the current scheme of things, there is no mechanism in place to ensure that the tribunal disposes the case in a timely manner. There is a strong need to bring in more accountability for the DRT,”. • One problem is the small number of DRTs and Debt Recovery Appellate Tribunals, where judgments of DRTs can be appealed. While there are 33 DRTs, there are only five Debt Recovery Appellate Tribunals in the country. “There is certainly a need for more number of DRTs. The biggest challenge, it appears, is their ability to deal with a subject with speed. • A consequence of this is credit cost increases even for borrowers who repay loans on time. For instance, banks now demand a credit-risk premium of close to six per cent from power companies to compensate for the risk of default. The average interest rate on loans to these companies is close to 14 per cent. • Experts suggest that the law should be strengthened to ensure mandatory time-bound disposal of cases. Also, performance indicators of the adjudicating officer could be used to improve the efficiency of the system. A few recommended that stay petitions should be analysed before being accepted as there have been instances where advocates exploit the loopholes of the Act and plead for stays, leading to piling up of cases. OTHER PRACTICE QUESTIONS

CURRENT ISSUES 2016 FOR IAS 2016 MAINS

  clickhere

HISTORY Mock Questions

  clickhere

ECONOMICS Mock Questions

  clickhere

POLITICAL SCIENCE Mock Questions

  clickhere

SCIENCE & CURRENT AFFAIRS Mock Questions

  clickhere

QUANTITATIVE APTITUDE Mock Questions

  clickhere

REASONING Mock Questions

  clickhere

ASSUMPTIONS & INFERENCES Mock Questions

  clickhere

INTERPERSONAL COMMUNICATION SKILLS Mock Questions

  clickhere

SOLVED ENGLISH PASSAGES

  clickhere

GEOGRAPHY & ENVIRONMENT Mock questions

  clickhere

DECISION MAKING Mock questions

  clickhere

IASMAINSSTUDYMATERIAL

ALLINDIAIASMOCKSERIES


Comment Box is loading comments...



ADVERTISEMENTS

copyrightimage