Non-banking financial services company Religare Enterprises Ltd (REL) on Wednesday said lenders to Religare Finvest Ltd (RFL) have in-principally agreed to consider the one-time settlement (OTS) proposal by its debt-ridden subsidiary.

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Religare has resolved many legacy issues left over by its erstwhile promoters, including settlement with Sebi and becoming debt-free, the company said in a statement.

RFL which has been a victim of siphoning off of funds by its erstwhile promoters has initiated and pursuing legal actions for recovery and has now begun its path towards revival, REL said.

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The company has been in financial distress, primarily due to the alleged misappropriation of funds by erstwhile promoters Shivinder Singh and his brother Malvinder Singh.

Post-RFL's OTS completion, it will have healthy prudential ratios, well above those prescribed by RBI, it added.

Dr Rashmi Saluja, the executive chairperson of REL, said, “The RFL OTS is a win-win solution for the lenders and RFL, especially for its revival and expansion. With the completion of OTS, all the legacy issues will be behind us and the Religare group will stride forward to focus on future growth and becoming a 360⁰ financial services provider."

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RFL has been barred from undertaking fresh business as it is under the corrective action plan (CAP) of the Reserve Bank of India (RBI) since January 2018 due to its weak financial health.