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American Express has notified its card customers that it will commence reporting card information to National e-Governance Services Ltd (NeSL) effective November.
This is in accordance with a 2017 RBI circular that asked financial creditors to submit financial information to an information utility under Section 215 of Insolvency and Bankruptcy Code (IBC).
According to Section 215 of IBC, a financial creditor shall submit financial information and information relating to assets in relation to which any security interest has been created, to an information utility (IU) in such form and manner as may be specified by regulations.
The Insolvency and Bankruptcy Board of India (IBBI) has registered National E- Governance Services Limited (NeSL) as the first IU under the IBBI (IUs) Regulations, 2017 on September 25, 2017.
In an email sent to its card customers, American Express said it will receive an email notification from NeSL on a monthly basis to review and verify the information that American Express will submit on an ongoing basis and they will have to register at NeSL’s portal to authenticate or dispute the information within a stipulated timeline, according to the communication.
American Express is not asking for any information, they are merely reporting the existing debt information in their system of records to NeSL, the company explained in the frequently asked questions that they have shared in the email to customers.
Back in March this year, American Express had communicated to its card customers about the same process.
In the frequently asked questions, American Express has explained the rationale of this process is to enable NeSL to accept, store, and make readily available authenticated financial information submitted by creditors that helps establish defaults as well as verify claims under IBC expeditiously and thereby facilitate completion of the insolvency resolution under IBC in a time bound manner.
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