Financial Awareness - Risk, Stability & Emerging Finance
The introduction of the SARFAESI Act, 2002, was a significant reform in the Indian banking sector because it:
The introduction of the SARFAESI Act, 2002, was a significant reform in the Indian banking sector because it:
medium Q5 of 15
Step-by-Step Solution
Step 1: Understand SARFAESI Act provisions
The SARFAESI Act empowers banks and financial institutions to recover dues by auctioning secured assets without court intervention.Step 2: Analyze other options
CRR maintenance is RBI's monetary tool; priority sector lending is a separate policy; MPC was established later for monetary policy decisions.Final Answer:
Allowed banks to auction properties of defaulters without court intervention → Option CQuick Check:
SARFAESI Act = banks can auction defaulters' assets without court ✅
Quick Trick: Remember SARFAESI = faster asset recovery for banks.
Common Mistakes:
- Confusing SARFAESI with monetary policy or lending targets.
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