Policy ID: PCI/POL/16/2026-27 • Version 1.0 Owner: CFO / Recovery / Legal • Approver: Board of Directors Sources: STR, IRACP • Review: Annual / regulatory change
Purpose and application
Technical write-offs, recoveries and compromise settlements subject to applicable regulatory scope.
1. Distinct treatment:- A technical write-off is an accounting action and does not forgive the borrower’s debt. A compromise settlement changes contractual claims only to the approved extent. Keep these separate from NPA classification and never promise a clean credit report after sacrifice.
2. Proposal and recovery analysis:- Recovery shall document dues, provisions, ageing, security value, legal status, recovery attempts and comparative net recovery. CFO and Legal shall assess economic benefit, tax/accounting consequences and staff accountability.
3. Approval safeguards:- Use Board-approved eligibility and delegation; approvers shall be at least one level above sanction authority as required. Persons involved in original sanction shall not approve the settlement. Fraud/willful-default cases need Board approval where applicable and continuing legal action.
4. Implementation:- Issue a written settlement amount, instalment dates, default consequences and security-release terms. Do not issue No Dues before cleared agreed funds. Apply regulatory cooling periods for fresh lending and restructuring treatment where settlement payment exceeds three months.
5. Records and reporting:- Maintain a separate written-off asset/recovery register and continue lawful recovery after technical write-off. CFO shall reconcile recovery income and make accurate credit bureau reporting. Board receives quarterly write-off/settlement and accountability reports.
Source codes are linked to the Reference Register. Read with the common implementation controls and relevant annexes. Applicable law and RBI Directions prevail.