NPA classification period likely to get 30-day extension as bad loans mount

Move to increase 90-day window to 120 days to give more time to borrowers to service loans

Topics
Bad loans | Non-performing assets | Indian Banks

Shrimi Choudhary  |  New Delhi 

The Centre is in talks with the Reserve Bank of India (RBI) and other stakeholders to consider the possibility of easing the norms for non-performing assets (NPAs), or bad loans, by extending the classification period to at least 120 days. At present, a loan account turns into an NPA if it is not serviced for 90 days.

The proposal comes in the wake of mounting bad loans, particularly of state-owned lenders, due to disruptions caused by the Covid-19 pandemic. According to the RBI, the NPA ratio of all commercial banks may increase from 8.5 per cent in March 2020 to 12.5 per cent in ...

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Mon, January 11 2021. 06:10 IST
RECOMMENDED FOR YOU
.