Q27: Under the Reserve Bank of India (Treatment of Wilful Defaulters and Large Defaulters) Directions, the bank must classify a borrower as a wilful defaulter within what timeframe?

Within 90 days of the default event.

Within six months of the account being classified as NPA.

Within one year of the show-cause notice issuance.

Before filing a recovery suit in the Debt Recovery Tribunal.

✅ Correct Answer: B

The bank shall complete the classification process within six months.

This timeframe starts from when the account is classified as a Non-Performing Asset (NPA).

Bank Promotion Exam Guide