“..This (Parate execution law) has to be strengthened to further minimise the time taken to recover the asset. So that banks and the businesses can survive and continue while the borrower who is not viable can basically transfer that asset to someone who can run the business. We don’t need to protect the borrower who is not liable, but the enterprise or the business,” Central Bank Governor said.

The Governor said that 3-6 month credit recovery would enable to make this transformation.

“Within three months, they acquire the property and let someone else to take the property and then borrow it out. So this is more efficient and will help the economy, help SMEs, and improve access to finance,” he elaborated.

Prior to this, Dr. Weerasinghe highlighted that it’s essential to understand the difference between the SMEs and anti-parate activists who are largely made up of willful defaulters.

Despite pressures from various quarters of the business community, especially the SME segment, the Central Bank continues to resist calls to amend banks’ Parate execution rights.