RBI has clarified that an Asset Reconstruction Company with Net Owned Fund below ₹1,000 crore may act as a resolution applicant under the IBC to acquire financial assets covered by the SARFAESI Act—without meeting the ₹1,000 crore NOF condition.

An important qualification: the relaxation applies where activities under the resolution plan remain within the ARC’s permitted SARFAESI scope. If the plan involves activities beyond that framework, the prescribed eligibility conditions continue to apply.

This clarity can expand participation by smaller ARCs, improve competition and bring specialised stressed-asset expertise into more resolution processes. Careful structuring of the resolution plan and the ARC’s precise role will remain essential.

ADRODEBT RESOLUTION PRIVATE LIMITED

Source: RBI FAQ dated 11 September 2026.