Commercial banks in India are expected to conduct over one lakh e-auction transactions during FY-14 to sell properties of non-performing assets (NPA).
Online data providers NPAsource.com claims that residential, agricultural, commercial and industrial properties are to be sold through the e-auction route, with the first two accounting for the largest number in terms of transactions.
The Ministry of Finance has made it mandatory for all commercial banks to move from physical auctions to e-auction mode for all NPA cases under the Debt Recovery Tribunal (DRT). Many large banks in the country are said to be under pressure due to mounting non performing assets. The portal adds that as on March 31, 2012, net NPAs of 40 listed banks were `61,558 crore, which rose to `92,398 crore as on December 31, 2012.
“E-auctions offer multiple advantages like lower cost, greater participation, save time and allows better price realisation for banks”,DK Jain, Chairman and Managing Director of Atishya Group which owns the portal said. He added that this automatically leads to a significant increase in the number of participants, reduces costs and eliminates or curtails manipulation by a small cartelised group.