RBI raised minimum capital requirement for setting up ARCs

RBI raised minimum capital requirement for setting up ARCs : The Reserve Bank has raised the minimum capital requirement for setting up an asset reconstruction company (ARC) to Rs 300 crore from Rs 100 crore.

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Aim: To strengthen the securitization sector which plays a vital role in the management of distressed financial assets.

RBI has generally requested all ARCs to gradually increase their minimum net-owned fund to Rs200 crore by the end of March 2024 and Rs300 crore by the end of March 2026.