CEIB pushes for mandatory clearance for private banks, posing loan challenge
Central Economic Intelligence Bureau has written to the department of financial services, finance ministry, to ensure all private banks seek mandatory clearance from CEIB, as in the case of government banks, on whether any enforcement case is pending against a company before extending them loans.
Once CEIB’s report becomes a requirement, it will pose a challenge for banks to provide loans to companies undergoing investigation by the Enforcement Directorate (ED) or the Central Bureau of Investigation (CBI), or those categorized as Non-Performing Assets (NPAs).
The current ‘antecedent verification report’, currently limited to public sector banks, offers strong risk assessment and mitigation measures, aiding financial institutions in conducting thorough due diligence against fraudulent activities by providing timely insights from CEIB.