NPA Act

The NPA Act, or the SARFAESI Act, stands for the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. It enables banks and financial institutions to recover bad loans more efficiently by allowing them to securitize assets, reconstruct financial assets, and take possession of properties when borrowers default. Essentially, it provides a legal framework for lenders to seize assets and sell them to recover unpaid dues without immediately resorting to court proceedings, thereby helping maintain the stability of the financial system and encouraging responsible lending.