Question of the Day:

Recently NSO published the Quarterly (April-June 2022-23) economic growth data of 13.5% over previous quarter of April to June 2021-22. The Nominal growth in GDP over the same period is 26.7%. You need to select the correct figure of "GDP Deflator" over the same period:

🌐 Reserve Bank of India would take up a pilot project for end-to-end digitization of Kisan Credit Card aiming to accelerate loan turnaround times.

#BLEditorial | The Centre should build on the success of PMJDY to promote other financial products for the lower sections of society.
https://www.thehindubusinessline.com/opinion/editorial/successful-inclusion/article65841671.ece

🫥Essay

✅NPA and Its Resolution

✅Self Written (@TargetDescriptive)


“Prevention is better than cure”

✅Non Performing Assets (NPAs) are a drain to the banks.The cases of NPA are increasing in the banking sector which is a matter of serious economic concern. Govt has come up with IBC and some other Bankruptcy settlement Schemes but the thing is how early Govt tackles and reimburse Payment through different Channels.

✅If the status of NPAs in banks is not controlled, banks can become bankrupt. The entire credit distribution structure of the economy may be destructed and the country could be in a major financial turmoil.

✅In a report RBI said that Banking NPA may go beyond 8% by Septemeber 2022 ,as Covid Hit the Sector harshly ,it was obvious that Sector wil see a Notable Surge in NPA ,a third wave poses high risk to the performance of the borrower ,that was impacted by the 1st and 2nd waves of Coronavirus!

✅
RBI FSR report says that gross non-performing assets (GNPA) ratio declining from 7.4 per cent in March 2021 to a six-year low of 5.9 per cent in March 2022,

✅A major cause for NPA is the fixation of unrealistic repayment schedule. Thus, it is important for the banks to observe its
recovery and upgradation by adopting few of the mentioned ways:

✅Cash recovery: Banks, instead of organizing a recovery drive based on overdues, must short list those accounts. The
recovery of critical amount (overdue interest and installment) will provide impetus to the system in reducing the pressure on
profitability by reducing the provisional burden; not making repayment of interest along with the installment of principal
amount.

✅Upgradation of assets: Once accounts become NPA, then bankers should take steps to upgrade them by recovering the
entire overdue. The recovery can be made from institutions giving guarantee like ECGC, pending government subsidies etc.

✅SARFAESI ACT, 2002: The SARFAESI empowers banks to deal with NPAs, without the involvement of court.

✅alternatives: Asset Reconstruction, Enforcement of Security, Securitisation.
-Credit Information Bureau: Third party agencies such as CIBIL helps banks with data on the financial health of the
borrower. It maintains records of individual defaulters and shares it with the respective banks to aid them in making effective
lending decisions.

✅If these steps are followed meticulously, the incidence of loans becoming NPAs will definitely reduce. Also, by proper follow
up, recovery is going to improve for some accounts as there will be the chances of upgradation of these accounts.

✺ Ꭻᴏɪɴ 🔥 ⃝➥ @TargetDESCRIPTIVE