Bank lending amount increased by 5.67 percent to Rs 104.04 lakh crore, while deposits increased by 10.63 percent to Rs 143.80 lakh crore in the fortnight ended November 6, according to RBI data.
Lending stood at Rs 98.46 lakh crore and deposits at Rs 129.98 lakh crore in the fortnight ended November 8, 2019. Credit had risen by 5.06 percent and deposits by 10.12 percent in the previous quarter ended October 23, 2020.
According to central bank numbers, the year-on-year growth of non-food bank credit decelerated to 5.8 percent in September 2020 from 8.1 percent in the same month of the previous year. In September 2020, credit to industry reported ‘no’ growth compared to a 2.7 percent increase in September 2019. Agriculture and Allied Operation Credit grew by 5.9 percent during the reporting month compared to a 7 percent rise in the same month last year.
Bank : NPAs
NPA is described by the RBI as any advance or credit that is more than 90 days overdue. When it ceases to produce revenue for the bank, an asset becomes non-performing,” said RBI in a circular form in 2007.” The 90-day overdue requirement for the identification of NPAs was adopted by RBI to be more attuned to foreign standards from the year ended March 31, 2004. There are various kinds of non-performing assets as well, depending on how long the assets have been an NPA.
What’s a bank asset?
Resources mean something owned by them. For banks, a loan is an opportunity and one of the most important sources of income is the interest we pay on these loans. The asset becomes ‘non-performing’ if consumers, retail, or companies are unable to pay the interest because it does not gain anything. Therefore, RBI described NPAs as assets that stop them from generating revenue.
Parliament was told on Monday that banks’ non-performing assets in major industries and services decreased 31 percent in over two years to around Rs 4.36 lakh crore in June this year. Minister of State for Finance Anurag Singh Thakur reacted in negative terms to whether the non-performing assets (NPAs) of large companies and corporate houses have risen sharply compared to small businesses due to non-repayment of loans over the past three years.