RBI’s new SNFA rules: Banks barred from selling assets to loan defaulters
The Reserve Bank of India (RBI) has barred banks from reselling specified non-financial assets (SNFAs) to loan defaulters, mandating that such assets be disposed of through public auctions. This regulation aims to ensure transparency and fair valuation of immovable properties acquired from borrowers who fail to repay loans. The RBI's Third Amendment Directions, 2026, establishes a framework for the acquisition, valuation, management, and disposal of these assets, impacting how banks handle defaulted loans.