A.Dear Client,
Under the CGTMSE Scheme, in case of borrower default, the Trust's liability is limited to the guaranteed portion of the defaulted amount, subject to certain caps. The lender must initiate recovery proceedings under due legal process and prefer a claim on the defaulted account. The Trust will honor 75% of the guaranteed portion initially, with the remaining 25% paid after recovery proceedings. The lender is responsible for recovery efforts even after the initial claim settlement. Notice under Lok Adalat is sufficient proof of legal action. If further action is needed, such as under the SARFAESI Act, the lender should proceed accordingly. Accounts classified as willful defaulters are ineligible for CGTMSE claim settlement. In case of SARFAESI Act action, seeking guidance from an Advocate and defending the case before the Debt Recovery Tribunal is advisable.
Under the CGTMSE Scheme, in case of borrower default, the Trust's liability is limited to the guaranteed portion of the defaulted amount, subject to certain caps. The lender must initiate recovery proceedings under due legal process and prefer a claim on the defaulted account. The Trust will honor 75% of the guaranteed portion initially, with the remaining 25% paid after recovery proceedings. The lender is responsible for recovery efforts even after the initial claim settlement. Notice under Lok Adalat is sufficient proof of legal action. If further action is needed, such as under the SARFAESI Act, the lender should proceed accordingly. Accounts classified as willful defaulters are ineligible for CGTMSE claim settlement. In case of SARFAESI Act action, seeking guidance from an Advocate and defending the case before the Debt Recovery Tribunal is advisable.
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A.You cannot do anything if you have taken the loan and the loan has become NPA. The bank shall start its own procedure to recover the loan by filing cases in the court or DRT depending on the amount.
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A.Dear Client,
Under the CGTMSE Scheme, in case of default by the borrower subject to the overall guarantee cap amount, the liability of the Trust in respect of credit facility shall be in case of Term Loan: - Defaulted amount (inclusive of 1 Quarter interest) and in case of ii. Working capital facility: - Outstanding working capital advance (inclusive of interest up to the date of NPA). The lender shall prefer a claim on the defaulted account on recall of the loan and initiation of recovery proceedings under due process of Law. As per Circular No.135/2017-18, the Trust will honor 75% of the guaranteed portion of the amount in default, subject to a maximum of 75% / 80%/85% of the amount in default. The balance of 25% shall be paid after the recovery proceedings. The lender continues to remain responsible for all efforts in the recovery of credit advanced to the borrower who had defaulted, even after the initial settlement of the claim by the Trust. The issue of notice under Lok Adalat is sufficient to prove that legal proceedings have been initiated against the defaulted borrower. Apart from the issuance of recall notice under the SARFAESI Act, the Lending institution should take further action as contained in Section 13 (4) of the said Act. The accounts classified as willful defaulters are not eligible for claim settlement under the CGTMSE Scheme. If the lender takes action under Section 13 (4) of the SARFAESI Act, reach out to an Advocate for guidance and to defend the case properly before the Debt Recovery Tribunal(DRT).
Under the CGTMSE Scheme, in case of default by the borrower subject to the overall guarantee cap amount, the liability of the Trust in respect of credit facility shall be in case of Term Loan: - Defaulted amount (inclusive of 1 Quarter interest) and in case of ii. Working capital facility: - Outstanding working capital advance (inclusive of interest up to the date of NPA). The lender shall prefer a claim on the defaulted account on recall of the loan and initiation of recovery proceedings under due process of Law. As per Circular No.135/2017-18, the Trust will honor 75% of the guaranteed portion of the amount in default, subject to a maximum of 75% / 80%/85% of the amount in default. The balance of 25% shall be paid after the recovery proceedings. The lender continues to remain responsible for all efforts in the recovery of credit advanced to the borrower who had defaulted, even after the initial settlement of the claim by the Trust. The issue of notice under Lok Adalat is sufficient to prove that legal proceedings have been initiated against the defaulted borrower. Apart from the issuance of recall notice under the SARFAESI Act, the Lending institution should take further action as contained in Section 13 (4) of the said Act. The accounts classified as willful defaulters are not eligible for claim settlement under the CGTMSE Scheme. If the lender takes action under Section 13 (4) of the SARFAESI Act, reach out to an Advocate for guidance and to defend the case properly before the Debt Recovery Tribunal(DRT).
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