CERSAI was established to prevent fraudulent lending

Solution

CERSAI stands for Central Registry of Securitisation Asset Reconstruction and Security Interest of India. • It was set up by the Government of India as a Section 8 company under the Companies Act, 2013. • The registry was created to curb frauds in lending, particularly where borrowers attempt to take multiple loans from different banks using the same property as collateral. • By recording details of security interests created by lenders, CERSAI ensures transparency and acts as a deterrent against fraudulent mortgage practices. Thus, the ‘S’ in CERSAI = Securitisation.