The Parliament passes the Factoring Regulation (Amendment) Act, 2021 on 7th August, 2021, amending the Factoring Regulation Act, 2011.
Key changes enacted by the amendment are:
- The amendment states that every factor shall register the particulars of every transaction of assignment of receivables in his favor with the Central Registry set-up under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
- In cases where any trade receivables are financed through a Trade Receivables Discounting System, the particulars shall be filed with the Central Registry on behalf of the factor by the Trade Receivables Discounting System. Trade Receivables Discounting System refers to a payment system authorized by the Reserve Bank under the Payment and Settlement Systems Act, 2007 for the purpose of facilitating financing of trade receivables.
- The Reserve has the power to make regulations and carry out the provisions of the Act.
*Tanvi Singh, Editorial Assistant has reported this brief.
