In pursuance of the decision taken during the State Level Bankers’ Committee (SLBC) Meeting for the quarter ended March 2026, held on July 3, 2026, and in follow-up to the North East Bankers’ Conclave (NEBC) 2.0, the Governor of Nagaland has constituted the State Level Committee on SARFAESI and Credit Mobilisation.
The committee will be chaired by the Finance Commissioner, Government of Nagaland. Representatives from the Law & Justice Department, Investment & Development Authority of Nagaland (IDAN), and the State Level Bankers’ Committee will be members. Representatives from SBI, Bank of Baroda, Nagaland Rural Bank, Nagaland State Cooperative Bank, UCO Bank, Canara Bank, Axis Bank, HDFC Bank and ICICI Bank will also be members. The Under Secretary, General Branch, Finance Department, will serve as Member Secretary, while representatives from NABARD, SIDBI and RBI, Kohima, will be special invitees.
The committee will address two key areas, namely security interest and the SARFAESI Act, 2002, and credit mobilisation.
On security interest, the committee will examine the legal position relating to the creation and enforcement of security interest in Nagaland under the SARFAESI Act, 2002, in light of Article 371(A) of the Constitution and the Supreme Court judgment in North Eastern Development Finance Corporation Ltd. v. M/s L. Doulo Builders and Suppliers Co. Pvt. Ltd., 2025 INSC 1446.
It will also evaluate an Article 371(A)-compatible statutory security instrument and collateral substitution through guarantee cover and cash-flow appraisal, and recommend the instrument or combination best suited to Nagaland. In consultation with the Law & Justice Department, the committee will ascertain whether the recommended instrument requires a resolution of the Legislative Assembly, a State notification or an SLBC operating protocol, and prepare the corresponding draft.
The committee will also seek the concurrence of SLBC member banks on the acceptance of the recommended documentation as valid security and credit-enablement documentation across the banking system in the State.
On credit mobilisation, the committee will activate State machinery for loan facilitation, including sponsorship, application readiness, guarantee tie-up and last-mile follow-through under flagship credit-linked schemes, building on the Chief Minister’s Micro Finance Initiative (CMMFI) as a working template.
It will recommend the design of a State Credit Guarantee (First-Loss Default Guarantee) Fund, including its corpus, coverage, trigger and exit terms, for placement before the Cabinet after FRBM and contingent-liability testing.
The committee will also recommend a productive-credit sub-target of not less than 50 percent of incremental credit as a formal SLBC performance metric, with the objective of ensuring that the Credit-Deposit (CD) ratio is not achieved through salary-backed personal lending alone.
Further, it will examine the linkage of Government banking business to bank performance within the RBI agency-bank framework and place the modality before the SLBC.
The committee may also examine any other matter incidental to making sound decisions on the terms of reference. It may co-opt members, invite special invitees and constitute sub-groups on legal and credit mobilisation matters.
The committee will submit its report to the State Government within 90 days and, on matters requiring approval, seek the same from the competent authorities.
(Molungnenla, IA)