BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Public Sector Banks
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Financial Institutes of the Govt.
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Private Banks
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Non Banking Financial Companies
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Detailed explanation-1: -The SARFAESI Act isn’t applicable for: The NPA loan accounts amounting to less than 20% of the principal and interest. Money or security issued under the Indian Contract Act or the Sale of Goods Act, 1930. Any rights of the unpaid seller under Section 47 of the Sale of Goods Act, 1930.
Detailed explanation-2: -Is there a threshold for applicability of SARFAESI Act on NBFCs? Yes, eligible NBFCs are allowed to enforce security interest in cases where the security interest was created in their favour to secure a financial assistance having a debt (as defined under SARFAESI Act) amounting to Rs. 50 lacs.
Detailed explanation-3: -The Sarfaesi act covers any asset, movable or immovable, given as security whether by way of mortgage, hypothecation or creation of a security interest. There are some exceptions in the act such as personal belongings. However, only that property given as security can be proceeded under the provisions of SARFAESI Act.
Detailed explanation-4: -An Act to regulate securitisation and reconstruction of financial assets and enforcement of security interest and to provide for a Central database of security interests created on property rights, and for matters connected therewith or incidental thereto.