Union Finance Minister Nirmala Sitharaman on Monday said the government has taken concrete measures to ensure rigorous and uniform assessment of mortgaged assets by banks and financial institutions.
Replying to supplementary questions in the Lok Sabha during Question Hour, the minister said the Reserve Bank of India has issued master directions to banks and financial institutions regarding the valuation of mortgaged assets.
She added that a strict Standard Operating Procedure (SOP) has been put in place to ensure transparency and accuracy in the valuation process.
RBI Guidelines for Property Valuation
According to the Finance Minister, the Reserve Bank of India has directed regulated entities to adopt a Board-approved policy for valuation of properties, including collateral accepted against loans and financial exposure.
She noted that such valuations are carried out by professionally qualified independent valuers to maintain credibility and transparency.
Banks and Housing Finance Companies (HFCs) are also required to empanel independent professional valuers for property assessments.
The minister further explained that banks and financial institutions must obtain at least two independent valuation reports for high-value properties:
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₹50 crore or above in case of banks
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₹75 lakh or above for Housing Finance Companies
E-Auctions for Transparency in Property Sales
To enhance transparency in the auction process of seized assets, the government has directed Debt Recovery Tribunals (DRTs) across the country to conduct all property auctions only through e-auctions.
For this purpose, the government launched the e-Bikray portal in February 2019, which facilitates the listing and auction of properties.
BAANKNET Portal for Seamless Auctions
The Finance Minister said the portal has been comprehensively upgraded to provide an integrated and modern platform for listing and auctioning properties under the SARFAESI Act, 2002 and the Recovery of Debts and Bankruptcy Act, 1993.
The revamped platform, known as BAANKNET, was launched in January last year to improve efficiency, transparency, and accessibility in the auction of mortgaged assets.
Officials said these measures are aimed at strengthening financial discipline, improving transparency in asset valuation, and ensuring a fair auction process in the banking system.
