The CERSAI has been established by the government to keep in check instances of fraud, in cases where properties are used as a collateral to get loans. In this article, we will discuss how CERSAI carries out that task and what implications its actions have, on home loan borrowers in India.
What is CERSAI full form?
The Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) was established, under Section 20 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). It is licensed under Section 25 of the Companies Act, 1956.
Role of CERSAI
CERSAI is a government-owned company that operates a central registry that deals with the filing of security interest of immovable, movable and intangible properties and assignment of receivables, among others, by financial institutions.
The government, in 2011, set up this central registry to track online data pertaining to lending transactions against equitable mortgages in India, with an aim to curb the rising number of property-related frauds.
The CERSAI is also entrusted with the responsibility of operating and maintaining a KYC registry, governed under the PML Rules, 2005 (Maintenance of Records). This CERSAI registry is a repository of security interest of immovable, movable, intangible properties and assignment of receivables. The CERSAI registry provides access to all records related to encumbered/attached properties. This registry caters to reporting entities of all four major regulators of financials sector – the RBI, the SEBI, the IRDAI and the PFRDA.
For the uninitiated, in an equitable mortgage, a customer borrows funds from banks with an agreement that his property, on which the equitable mortgage is created, will act as security for the loan.
Main objectives of CERSAI
*The main purpose of the CERSAI is to operate as a registration system. It is entrusted with the responsibility of operating and maintaining a KYC registry, governed under PML Rules 2005 (Maintenance of Records).
*India’s online security interest registry has all the information about loans, helping lenders and borrowers have access to useful information.
*The Central KYC Record Registry hosts more than 35 crore KYC records.
*Banks are obliged to report to the government all interest created in any securities. The CERSAI acts as a platform of filing that information.
*The platform also has attachment orders and court orders on encumbered /attached properties.
*By way of providing data transparency, the platform checks fraudulent activities related to equitable mortgages
Who owns CERSAI?
While the central government, so far, holds a majority stake in the entity, the CERSAI, in March 2021, said that the Reserve Bank of India (RBI) may pick up the government’s 51% stake in the central registry, since all its functions are related to banking activities.
The remaining 49% stake in the CERSAI is held by state-run lenders, including State Bank of India, Punjab National Bank and Bank of Baroda, along with the National Housing Bank.
Key functions of CERSAI
Essentially, all of CERSAI’s functions and activities are related to banks, housing finance companies (HFCs) and non-banking finance companies (NBFCs). The central registry, among other things, deals with the filing of security interest of immovable, movable and intangible properties by lenders. Simply put, the CERSAI login is an online database of all the properties mortgaged with banks in India.
From 2016, the CERSAI also operates and maintains a Central KYC Record Registry (CKYCRR) with an aim to serve reporting entities of the RBI, the SEBI, the IRDAI and the PFRDA.
For all the security interests created from January 22, 2016, for scheduled commercial banks, CERSAI has all the data. From July 1, 2016, it has maintained the data for all other entities registered with it. From June 2017, CERSAI started registration of data on security interest in under-construction properties.
What is CERSAI search?
As far as the real estate sector goes, any bank or lender dealing with property transactions can access the records maintained by the CERSAI, to detect potential frauds, where an owner may have borrowed from multiple sources using the same property as security.
CERSAI log in
When logging into the official CERSAI portal, make sure of the below mentioned points:
To use the CERSAI 2.0 URL, clear your browser history. You have to use the ctrl+shift+delete keys to do so.
Use the URL: https://cersai.org.in/CERSAI/home.prg and enter the same in address bar of the window.
Ensure that after login there should be no ‘www’ in the CERSAI 2.0 URL. Do not use the URL: https://www.cersai.org.in/CERSAI/home.prg. Also, delete the existing saved CERSAI URL from the bookmark.
Do not fetch the CERSAI website through Search Engines like Google.
- To use the new version of the website, CERSAI 2.0, clear your browser history.
- Use the URL – https://cersai.org.in/CERSAI/home.prg – and enter the same in the address bar of the window.
- Do not use ‘www’ in the CERSAI 2.0 URL.
- Delete the existing saved CERSAI URL from the bookmark if any.
- Do not fetch the CERSAI website through search engines.
How does the CERSAI database help home buyers?
Real estate projects in India have to meet certain specifications in terms of size and value to fall under the ambit of the real estate regulatory act. This made checking up on the financial health of the developer from whom they planned to buy a flat hard for homebuyers. That was before the CERSAI came into being. Since the CERSAI portal gives the common public access to valuable data, prospective investors can check if the property is mortgaged with some financial institution or if there are any encumbrances attached to it.
How is the CERSAI database updated?
Any time a bank provides a loan to anyone against a property pledged as security, it is liable to submit the details of the transaction to the CERSAI database, through a process known as the ‘registration of charges’. The purpose of the registration of charges is to act as a public database about encumbrances on properties.
It is mandatory for all banks to provide this information to the CERSAI, within 30 days of the transaction taking place. In case they fail to provide the details of mortgaged properties within this time frame, banks are penalised in the form of monetary penalties.
CERSAI registration fee
The CERSAI imposes a fee known as the fee for registration of security interest. The charge varies between Rs 50 and Rs 100, depending on the amount of loan that has been granted against the property.
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CERSAI charges on home loan
When processing your home loan request, the bank will have to pull out records from the CERSAI, to ensure that everything is right with the property title and that it has not been mortgaged with any other bank. For this, it will have to pay a fee to the central registry. Subsequently, it will ask the home loan borrower to pay the CERSAI fee.
This CERSAI charge on home loan is also referred to by the name ‘memorandum of deposit of the deed fee’ and must be paid, irrespective of whether the bank approves or rejects your home loan request at a later stage.
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How to register DSC on CERSAI?
Before starting the registration, know that you need a valid Class-3 DSC with USB Token, DSC software and User ID and password.
Step 1: On CERSAI official website, click on the Login button on the top right of the page.
Step 2: Enter user ID, password and captcha. Click on the Login option.
Step 3: Select your digital signature certificate.
Step 4: Use UKB token password.
Step 5: Validate the DSC to authorise the person concerned as an authorised signatory.
Step 6: Check the I accept the agreement option. Click on Register to complete DSC registration.
Can a home loan borrower search property mortgage-related information on the CERSAI database?
Yes, anyone can search property mortgage-related information on the CERSAI database.
What is the fee to get property mortgage related information on the CERSAI database?
For each search, the user will have to pay Rs 10 plus GST, as search charges.
How to search details of mortgaged property on the CERSAI portal?
Anyone can get information about mortgaged properties in India at https://cersai.org.in/CERSAI/home.prg. After clicking on the ‘Asset Based Search’ tab under ‘Public Search’, you will then have to enter the asset’s details and make the payment, before the report information is generated.