Regional Rural Banks – Priority Sector Lending (PSL)

    Regional Rural Banks – Priority Sector Lending – Targets and Classification   Targets: 75 per cent of total outstanding to the sectors eligible for classification as priority sector lending and sub sector targets as indicated in subsequent paragraphs. Categories of the Priority Sector: Medium Enterprises, Social Infrastructure and Renewable Energy will form part of the Priority Sector, in

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Maintenance of CRR/SLR on Foreign Currency Assets/Liabilities

    Maintenance of CRR/SLR on Foreign Currency Assets/Liabilities   Financial Benchmarks India Private Limited (FBIL) has taken over the process of computing and disseminating reference rate for INR/USD and exchange rate for the other major currencies with effect from July 10, 2018. In this connection, banks shall use the conversion rate announced by FBIL for the purpose of converting

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Types of Charges over Securities in a Bank Loan

1. Pledge 2. Hypothecation 3. Assignment 4. Mortgage Pledge     Pledge is defined in section 172 of Indian Contract Act. Pledge is the bailment of goods as a security for payment of a debt or performance of a promise. Bailment is defined in Indian Contract Act. Bailment means delivery of goods with some purpose and with the condition that

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MORTGAGE

    Mortgage   Mortgage is defined in Section 58 of the Transfer of Property Act 1882. Mortgage is the transfer of interest in a specific immovable property, for the purpose of securing an existing or future debt. The person creating the mortgage is called as the mortgagor and the person in whose favour mortgage is created (bank) is called

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ASSIGNMENT

    Assignment   Provisions relating to Assignment in section 130 of Transfer of Property Act 1882. Assignment is transfer of right or interest to recover the debt. The transferor of claim is called as the assignor and the transferee is called the assignee. Assignment is done on Book Debts, Supply Bills, LIC policy, fixed deposit etc. Assignment is possible

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HYPOTHECATION

    Hypothecation   Hypothecation is defined in Section 2 of SARFAESI Act. Hypothecation is also done on moveable property like stocks. In case of hypothecation both ownership as well as possession remains with the borrower i.e. neither ownership nor possession is transferred to the bank. The charge created in Hypothecation is equitable charge. When stocks are hypothecated to the

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PLEDGE

    Pledge   Pledge is defined in section 172 of Indian Contract Act. Pledge is the bailment of goods as a security for payment of a debt or performance of a promise. Bailment is defined in Indian Contract Act. Bailment means delivery of goods with some purpose and with the condition that when the purpose is accomplished the goods

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