ARCs are registered and regulated under the RBI Act. They acquire financial assets from banks/FIs either on their own books or in the books of a trust set up for the purpose of securitisation and/or reconstruction. 1. 2002 - The Government of India enacted the SARFAESI Act in 2002, based on suggestions of previous expert committees, and paved the way for setting up ARCs in India. ==The Act envisaged that ARCs would be registered and regulated by RBI.== 2. April 2003 - Accordingly, initial guidelines were issued by RBI. 3. 2003 - The first ARC, namely, Asset Reconstruction Company (India) Limited, was also registered in 2003. 4. As on 2021, there are 28 ARCs in operation. 5. As on March 31, 2021, the cumulative AUM of the Sector stood at approximately Rs.5.2 lakh crore in terms of book value acquired and the cumulative capital at play, as measured in terms of NOF, of the Sector stood at approximately Rs.9.8 thousand crore. [^1] **Liquidation** 6. Court - The National Company Law Tribunal (NCLT) is the primary adjudicating authority for corporate liquidation/insolvency (or restructuring) in India under the Insolvency and Bankruptcy Code [(IBC)](https://ibbi.gov.in/legal-framework/act) 2016. It handles compulsory liquidation when a company fails to revive through the Corporate Insolvency Resolution Process (CIRP). NCLT has regional benches across India, with appeals heard by the National Company Law Appellate Tribunal (NCLAT) 7. Regulator - Here the regulator is The Insolvency and Bankruptcy Board of India ([IBBI](https://ibbi.gov.in/about)). ## Groups/Committee 1. [1991](RBI_Report_199111_Committee%20on%20the%20Financial%20System_Narasimham%20Committee%20I.pdf) - Committee on Banking Sector Reforms of 1991 (Narasimham Committee I) 2. [April 22, 1998](RBI_Group-Committee_19980422_Report%20of%20the%20Committee%20on%20Banking%20Sector%20Reforms-Narasimham%20Committee%20–%20II%20(1998).pdf) - Committee on Banking Sector Reforms of 1998 (Narasimham Committee II). 3. [December 20, 1999](RBI_Group-Committee_19991229_RBI_Group-Committee_19991220_Report%20of%20The%20In-house%20Working%20Group%20On%20Asset%20Securitisation.pdf) - Report of the In-house Working Group on Asset Securitisation 1999 4. 1999-2000 - Expert Committee (also known as Andhyarujina Committee), chaired by Arvind P. Dandekar, for recommending Changes in the Legal Framework concerning Banking System 5. [May 2, 2014](RBI_Press%20Release_20140502_May%2002,%202014%20Report%20of%20the%20High%20Level%20Working%20Group%20on%20Resolution%20Regime%20for%20Financial%20Institutions.pdf) - The [Report](RBI_Press%20Release_20140502_May%2002,%202014%20Report%20of%20the%20High%20Level%20Working%20Group%20on%20Resolution%20Regime%20for%20Financial%20Institutions.pdf) of the Working Group on Resolution Regime for Financial Institutions was [released](PIB_20140502_Report%20of%20the%20Working%20Group%20on%20Resolution%20Regime%20for%20Financial%20Institutions.pdf) 6. ==Nov 2, 2021 - The [Report](RBI_Group-Committee_20211102_Report%20of%20the%20Committee%20to%20Review%20the%20Working%20of%20Asset%20Reconstruction%20Companies.pdf#page=8&selection=46,0,46,48) of the **Committee to Review the Working of Asset Reconstruction Companies** was published.== ## Master Directions 1. ==[Nov 28, 2025](https://rbi.org.in/scripts/NotificationUser.aspx?Id=12927) - Reserve Bank of India (Asset Reconstruction Companies) Directions, 2025== 2. It superseded the following directions: 1. [April 24, 2024](RBI_Press%20Release_20240424_Master%20Direction%20for%20Asset%20Reconstruction%20Companies%20(ARCs).pdf) - Reserve Bank of India (Asset Reconstruction Companies) [Directions](https://rbi.org.in/scripts/NotificationUser.aspx?Mode=0&Id=12669), 2024, last updated April 23, 2025. 3. Nov 28, 2025 - Reserve Bank of India (Asset Reconstruction Companies – Know Your Customer) [Directions, 2025](https://rbi.org.in/scripts/NotificationUser.aspx?Mode=0&Id=12927) 1. In India, the Prevention of Money-Laundering Act (PML Act), 2002, and the Prevention of Money- Laundering (Maintenance of Records) Rules (PML Rules), 2005, form the legal framework on Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT). 2. The provisions of the PML Act, 2002 and the PML Rules, 2005, as amended from time to time by the Government of India, require Regulated Entities (REs) to follow certain customer identification procedures while undertaking a transaction either by establishing an account-based relationship or otherwise, and to monitor their transaction. 4. Nov 28, 2025 - Reserve Bank of India (Asset Reconstruction Companies – Treatment of Wilful Defaulters and Large Defaulters) [Directions, 2025](https://rbi.org.in/scripts/NotificationUser.aspx?Mode=0&Id=12928) 5. Nov 28, 2025 - Reserve Bank of India (Asset Reconstruction Companies – Credit Information Reporting) [Directions, 2025](https://rbi.org.in/scripts/NotificationUser.aspx?Mode=0&Id=12929) ## References 1. RBI. (Nov 2, 2021). Report of the Committee to Review the Working of Asset Reconstruction Companies. [pdf](RBI_Group-Committee_20211102_Report%20of%20the%20Committee%20to%20Review%20the%20Working%20of%20Asset%20Reconstruction%20Companies.pdf#page=8&selection=46,0,46,48) ### [[Speeches & Media Interactions|Speeches]] 1. RBI. Sep 15, 2015. ==Asset Reconstruction and NPA Management in India==. (Shri R. Gandhi, Deputy Governor – September 15, 2015 – ReModel in India – Assets Reconstruction and NPA Management Summit organized by Economic Times, Mumbai). [Link](https://rbi.org.in/scripts/BS_SpeechesView.aspx?Id=974) 2. RBI. (May 29, 2024). ==Setting the Right Tone from the Top.== (Speech by Shri Swaminathan J, Deputy Governor, Reserve Bank of India - May 17, 2024 - at the Conference of Asset Reconstruction Companies (ARCs) held in Mumbai). [Link](https://rbi.org.in/scripts/BS_SpeechesView.aspx?Id=1434) [^1]: RBI. (Nov 2, 2021). Report of the Committee to Review the Working of Asset Reconstruction Companies. [pdf](RBI_Group-Committee_20211102_Report%20of%20the%20Committee%20to%20Review%20the%20Working%20of%20Asset%20Reconstruction%20Companies.pdf#page=8&selection=46,0,46,48)