Wilful defaulter

A wilful defaulter is a borrower classified as such by a lender under the Reserve Bank of India's regime for wilful and large defaulters. The rule sits in the Reserve Bank's instrument of 28 November 2025, DOR.FIN.REC.No.85/20-16-003/2025-26, which restates the regime issued as a Master Direction on 30 July 2024. The source given below is the Reserve Bank of India (Commercial Banks, Resolution of Stressed Assets) Directions, 2025, issued on the same date.

An outstanding of INR 25 lakh and above brings an account within the machinery. The classification exercise is to be completed within six months of the NPA classification, through an Identification Committee headed by a whole-time director or equivalent, a show cause notice carrying twenty-one days to respond, and a Review Committee that must offer a personal hearing. Legal representation at that hearing is not permitted, which changes how the written response has to be built. The position is stated as at 21 September 2026.