Forensic Audit: Banks to report non-cooperation

Borrowers who don’t cooperate in their forensic audits will now be reported to all banks. The move comes as lenders want to speed up the forensic audit while preventing such borrowers from taking any more loans from other banks.

According to an official, who did not wish to be identified, banks have agreed to update the status of such borrowers in the Central Repository of Information on Large Credits (CRILC) constituted by the sector regulator, Reserve Bank of India.

“Banks can take a decision based on this information and decide not to lend until the borrower gets a clean chit,” he said.

Indian Banks’ Association chief executive Sunil Mehta confirmed the development and said this will bring more discipline among the borrowers. “Based on various parameters, including early warning signals (EWS), banks do such audits to take proactive action,” he said.