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By adoptin proper credit evaluation process. There is no one method for reducing the NPA. Multiple strategies should be adopted from the beginning. The first stage is proper credit evaluation process. It should be based on objective evaluation and the project should be economically viable and technically feasible. Only such projects which can generate income and which RBI has permitted should be financed. Once the loan is sanctioned the post followup should be meticulously followed. Regular monitoring of delinquent loans is essential.
If the delinquencies are due to reasons beyond the control of borrower, for example, as in the case of excess of rains, flood, famine, etc the banker should suitably restructure the loans taking into consideration of the genuine difficulty of the borrowers. Recovery, it should be remembered, should always be at the cost of borrower's prosperity. The recovery process is an ongoing process and it should be professionally handled. My own experience is that if we are honest and keep the interest of the borrower and if the borrower is made to feel whatever steps we are taking is in his own interest he will positively respond. In addition to our honesty and promptness, the language we use while communicating to the borrower also matters very much. The language should be healthy, positive and should NOT blame the borrower directly for delinquency of the loans. That attitude of the banker also matters. M.J. SUBRAMANYAM, BANGALORE
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Review of literature on non performing assets?
literature review on non performing assets?
What is the use of non performing assets?
Non performing Assets either a Short term or a Long term asset is marked to be Amortized. It may have a depreciation value.
How do you reduce non performing loan?
The ways to reduce non-performing loans sometimes change depending on the state of the economy. As of mid-2014, it is suggested that you should restructure your credit to reduce them.
What is the fullform of NPA as used in banking sector?
non performing assets
Mention some examples of non performing assets?
bank loan , home rent
Define non performing assets coverage ratio?
The ratio of provision against total NPA
What is the definition of Non Performing Assets by RBI?
As defined by RBI, an NPA or non-performing asset is credit in which interest has been past due for a period of time. A good example would be the interest of an unpaid loan.
What are non earning assets in banks?
Non-Earning Assets for banks are usually the loans for which the loan customers arent paying their monthly EMI's. Banks earn an income through the interest they get paid by the loan customers. So, if a loan customer defaults on his/her payment, the loan becomes a Non Earning or a Non Performing Asset. The term Non Performing Asset (NPA) is more commonly used than Non Earning.
Which of the following acts was framed specially to deal more effectively with the problem of non-performing assets in banking system?
Sarfaesi act
What are Non performing asset of banking industry?
A Non-Performing Asset or NPA is an asset of the bank that is not performing its intended job i.e., earn money for the bank. From the bank point of view, Loans are assets. A loan for which the customer is repaying his monthly installments regularly every month is a properly performing asset. Whereas a loan for which the customer has defaulted on the monthly payment for more than 3 months is considered a non performing asset.
Is industrial unit covered under sarfaesi act?
The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, allows banks and financial institutions to auction properties (both residential and COMMERCIAL) when borrowers fail to repay their loans. It enables banks to reduce their non-performing assets (NPAs) by adopting measures for recovery or reconstruction.
How many types of non performing assets are there?
basically according to performance three type or NPA 1 substandred 2 doutful 3 loss
