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Question : The Reserve Bank of India raised the minimum capital requirement for setting up an asset reconstruction company (ARC) to Rs.____ crore in October 2022.

Option 1: 350

Option 2: 300

Option 3: 200

Option 4: 250


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Answer (1)
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Correct Answer: 300


Solution : The correct option is 300.

In 2022, the Reserve Bank increased the minimum capital requirement for establishing an asset reconstruction company (ARC) from Rs 100 crore to Rs 300 crore. This move aims to enhance the robustness of the securitisation sector, a crucial element in the handling of distressed financial assets. The current Asset Reconstruction Companies (ARCs) have been provided with a gradual transition period to fulfil the minimum Net Owned Fund (NOF) requirement until April 2026.

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