Finance Ministry Urges Banks to Enhance DRT Management

The Finance Ministry has instructed banks to implement effective monitoring and oversight mechanisms for managing pending cases in Debt Recovery Tribunals (DRTs). In a meeting chaired by Financial Services Secretary M Nagaraju, best practices and efficient policy definitions were discussed for optimizing recovery and reducing case pendency.

The Finance Ministry has called on banks to establish robust monitoring and oversight systems to manage pending cases in Debt Recovery Tribunals (DRTs) more efficiently.

Financial Services Secretary M Nagaraju, who led a meeting with chairpersons of Debt Recovery Appellate Tribunals (DRATs) and Presiding Officers of DRTs, discussed adopting best practices to enhance outcomes in DRTs across the board. The aim is to optimize the recovery process and reduce case pendency, according to an official statement.

Banks are urged to define clear policies for both small and high-value cases pending in DRTs to ensure efficient recovery. Collective stakeholder efforts and effective measures are essential for this optimization.

Faster recovery enables the reutilization of capital stuck in pending cases, contributing to the economy's productive use. The meeting also emphasized the consideration of transaction costs in settlement policies. The updated DRT Regulations 2024, which incorporate improvements over the earlier 2015 regulations, will be adopted by all DRTs to streamline processes and reduce time consumption.

(With inputs from agencies.)