MUMBAI, June 7 (Reuters) - The Reserve Bank of India diluted its earlier guidelines on stressed assets and has now mandated banks to undertake a review of a borrower account within 30 days of default, according to a fresh circular issued on Friday.
The previous circular, issued on Feb. 12 last year, required banks to initiate a resolution process within a day of default.
The circular was struck down by the Supreme Court of India in April after several companies had challenged the guidelines in court arguing the time given by the central bank was insufficient to tackle bad debt.
The RBI has also asked banks to make additional provisions in case of failure to implement a resolution plan within given timelines, the circular showed. (Reporting by Mumbai Team; Editing by Nick Macfie)