New Delhi, July 24 (IANS): Finance Minister Arun Jaitley on Monday introduced a bill under which the Centre may authorise the Reserve Bank of India to direct banks to initiate recovery proceedings against loan defaulters.

The Banking Regulation (Amendment) Bill will replace an ordinance that earlier enabled this. 

The recovery proceedings would be under the Insolvency and Bankruptcy Code, 2016 that provides for a time-bound process to resolve defaults.

Trinamool Congress member Saugata Roy opposed the introduction of the Bill. "It is a desperate step by a desperate government," Roy said.

"The same RBI is being authorised to regulate banks which has till date not been able to give (the total) amount of money deposited in banks after demonetisation," Roy said.

He demanded the bill to be sent to a parliamentary committee.

Jaitley responded saying that the objections raised by Roy had nothing to do with the introduction of the bill.

"The issues raised by him can be discussed when the bill comes up for discussion," the Minister said, after which it was introduced in the House.