SARFAESI Act, 2002 (Securitization Act)

The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 enables banks and financial institutions to recover secured debts without approaching civil courts.

When a borrower defaults and the account becomes an NPA (non-performing asset), the bank may issue a demand notice under Section 13(2) and take possession of the secured assets under Section 13(4).

The Act significantly speeds up recovery proceedings and reduces delays in debt recovery litigation.