E-commerce service companies appear to have got a new lease of life following the finance ministry’s directive to banks last June, asking them to conduct auctions of non-performing assets (NPAs) online – to make the process more transparent.
The ministry was concerned at instances of deals being struck between bank officials and parties interested in properties that land in the Debt Recovery Tribunal or are taken possession of by the lenders under the SARFAESI Act. As per the ministry’s directive, the complete process – from creation of events, submission of first round quotes by bidders, evaluation and final auction – is to be done online.
For the business-to-business e-commerce companies, faced with dwindling interest from corporates, this has come as a new business opportunity. At least three portals – NPAsource.com of Atishya Technologies Pvt Ltd, bankeauctions.com of CI India Pvt Ltd and e-auctions.in of Nextenders India Pvt Ltd – have sprung to life following the finance ministry move.
While NPAsource.com has been functioning for some months, bankeauctions.com has started operations a month back. Banking sector’s big daddy State Bank of India (SBI) has tied up with both the portals. “We have signed the Letter of Intent with SBI, including its subsidiaries, and expect to start transacting with them by the end of February,” Umesh Ranjan, CEO of CI India, told DNA.
Starting with e-auctioning of NPAs, the banks would also be harnessing the advantages of an electronic platform to do other business transactions as well, including sales of assets possessed under foreclosure norms and material procurements. “Going forward, SBI would be using our platform for reverse auction for procurement activities as well,” said Umesh.
Apart from SBI, close to 20 banks, including Punjab National Bank, Bank of Baroda, Canara Bank, have been using the bankeauctions.com site for disposal of their NPAs.
Most of the banks are likely to use multiple e-auction service providers to ensure transparency.