NBFC-Assignment of Receivables

Sir, NBFC involved in asset/ vehicle financing has amount financed to custmers as stock, some of the loan accounts can be sold to banks or NBFC subject to RBI norms and securitisation provisions. Once these assets are sold to other party we are not entitled to show them as receivable of our company, there is seperate accounting treatment for removing the receivables from our books (through Memorandam accounts). We are also not eligible to recognised interest income over those receivables because they are no longer our receivables.

                    Regarding cash collateral, it is a deposit placed in some scheduled bank by the selling NBFC. the purpose is to adjust the NPA interest portion of the receivable with the interest on such collateral.