The share of retail in overall debt acquired by asset reconstruction companies (ARCs) has gone up significantly—from 4% in FY19 to 32% in FY22—because of the pandemic-hit MSME sector.
The private-sector ARCs are focusing more on the retail and MSME segments, while the government-promoted bad bank, NARCL, is scaling up business in line with its mandate of acquiring large corporate loans.
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While the security receipts redemption ratio for ARCs is improving, it still remains below potential.