The Reserve Bank of India (RBI) on Tuesday issued a draft circular to provide clarity on prudential treatment of specified non-financial assets (SNFA) acquired as collaterals in the case of defaults. The RBI define these assets as an immovable asset acquired by regulated entity in satisfaction or part satisfaction of its claims on the borrower, including nonbanking assets. The regulator urged the entities to incorporate suitable clauses for acquisition of such assets and their disposal. These should include limit of these assets as a share of total assets, eligibility criteria, delegation matrix, recovery efforts to be explored before acquisition and maximum period for disposal.