NPA Resolution & Settlements · Question

Why is my lender not responding to my settlement proposal?

Short answer

Silence usually reflects internal process rather than a refusal. Your proposal may be travelling through valuation, legal review and several approval layers, or the official handling it may lack the authority to reply. It can also stall if the proposal is incomplete or unrealistic. Follow up in writing, ask who is handling it, and check that nothing needed is missing.

In more detail

From the borrower's side a proposal feels like one decision. Inside the lender it is many small steps, each owned by a different person, and little of that is visible to you.

Common reasons for delay:

The proposal is waiting for a fresh valuation of security, a legal opinion or an updated statement of dues.
The file sits with a recovery or stressed-asset team that must seek approval from a higher committee, which meets on its own schedule.
The officer handling your account changed, and the file is not yet picked up.
The offer is below what the lender's internal norms allow, so staff are reluctant to table it without changes.
Key documents, such as financial statements or proof of funds, are missing or out of date.
The lender is considering sale of the account to another entity and has paused direct talks.

A useful follow-up is brief and specific. Write to the officer and their superior, refer to the date of your proposal, ask whether any further information is needed, and request a timeline for the next step. Offer a meeting. Note down each call and confirm by email.

Make the next step easy

Attach a one-page summary of the proposal, a list of enclosures and a clear contact person. A committee note is easier to write when the borrower has already done the structuring.

Avoid flooding the lender with repeated demands or new, inconsistent offers, which can reset the process. If delay continues, escalation within the lender's grievance or senior management channels is generally available, and a qualified advisor can help judge when it is appropriate. No one can promise a response time or an outcome.

Key points

Silence is often internal approval flow, valuation or legal review, not rejection.
Missing or outdated documents are a frequent cause of delay.
Follow up in writing, name the proposal date and ask what is needed next.
Send a short summary and enclosure list so the lender can table the case easily.
Avoid repeated inconsistent offers; use senior and grievance channels if delays persist.

Who this applies to

Borrowers who submitted a settlement or repayment proposal and heard nothing.
Finance heads managing follow-up and document requests.
Promoters unsure whether silence means rejection.

Last reviewed 3 October 2026

This answer is general information, not advice on your particular case. Terms, eligibility, and requirements change, so check the current position with the relevant institution or authority. Lalsar Holdings' financial advisory and financing work is advisory and facilitation only. Lalsar Holdings is not a lender. Sanction and disbursement of any credit facility is at the sole discretion of the partner bank, NBFC, or financial institution involved, subject to their own eligibility criteria and credit policy.