National Bank for Agriculture and Rural Development Act,1981

Act No : 61

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Section : Security for credit.

28. Security for credit.-(1) No accommodation shall be granted by the National Bank under clause (a) or clause (c) of sub-section (1) of section 25 or section 30 or section 32 to any institution other than a scheduled bank unless it is fully and unconditionally guaranteed by the Government as to the repayment of principal and payment of interest: Provided that no such guarantee shall be required in cases in which security to the satisfaction of the Board is furnished by the borrowing institution. (2) No accommodation shall be granted by the National Bank under clause (a) or clause (c) of sub-section (1) of section 25 or section 32 to any scheduled bank unless security to the satisfaction of the Board is furnished by such scheduled bank. (3) Notwithstanding anything contained in sub-section (1) or sub- section (2), no guarantee or security referred to therein shall be required in any case 329 in which the Board, for reasons to be recorded by it in writing, decides having regard to the nature and scope of the scheme or schemes for which accommodation is granted by the National Bank that such security or guarantee is not necessary.

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