Average annual loan recovery rate under DRT 25 pc: CUTS

PTI, March 11, 2016

The average annual recovery rate under Debt Recovery Tribunal (DRT) mode was estimated to be around 25 per cent, said a report.

“Consequently, considering a four-year wait to dispose all the cases pending under DRT mode, opportunity cost to banks and financial institutions was estimated to be around Rs 25,000 crore,” CUTS International said in a statement.

The average annual recovery rate under Securitisation mode was estimated to be around 27 per cent. Considering at least three and half years wait to recover the total amount pending under SARFAESI mode, additional cost was estimated to be around Rs 10,000 crore.

Thus, the total cost to economy of inefficient debt recovery process is estimated to be around Rs 35,000 crore.

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