WHAT IS CERSAI AND WHAT ARE ITS OBJECTIVES?

 

CERSAI or the Central Registry of Securitisation Asset Reconstruction and Security Interest is a Government of India company with its majority shareholdings owned by Public Sector Banks, Housing Finance Companies, and the Central Government of India. Licensed under section 8 of the companies Act of 2013, CERSAI was introduced to protect the interests of the lender and borrower through transparency across all financial transactions. Earlier, borrowers would take multiple loans from various financers. Now, with CERSAI, these illegal practices can be deterred. Lenders can conduct background checks on CERSAI’s official website to see if more than one individual is seeking a loan against property or if the property has been mortgaged to another lender. 

 

Incorporated sometime in 2011, the Security Interest Registry had its humble beginnings for the filing of Security Interest of Immovable Properties. Today, the body has transformed into a complete registry that includes the assignment of receivables, immovable, intangible, and moveable property security interests. 

 

Creditors also have the facility of filing attachment orders and court orders, thus providing a complete insight into any attached or unencumbered property. While financial institutions can leverage insights provided on the CERSAI website, for a fee, individuals may access information only about equitable mortgages.

 

Accessibility 

Accessible to all, CERSAI is an online registry platform that charges a nominal fee from lenders who wish to gather information about a particular property. This activity is carried out before sanctioning a loan to the borrower. Potential home and property buyers can greatly benefit from this, as CERSAI’s report indicates whether the property they are interested in purchasing is free of any loan or liability. 

Registration 

●       The official CERSAI site includes an online registration form under the ‘Entity Registration’ section

●       Just fill in the pertinent details with a digital signature to gain access to the portal

●       The relevant forms have to be signed by the authorised signatory

●       All required documents have to be sent to CERSAI’s address as mentioned on the website

 

Uses and objectives of CERSAI

●       Formed with the intention of maintaining a centralised registry of equitable mortgages CERSAI aims to clamp down on all fraudulent activities

●       Financial institutions and banks can now register any transaction related to securitisation and asset reconstruction

●       The scope of CERSAI was expanded in 2012 allowing the registration of security interests through the assignment of account receivables

●       Furthermore, the objectives of CERSAI were stretched to include the registration of all kinds of mortgages 

●       Security interests created on non-tangible assets may also be registered here