International Journal of Advanced Academic Studies
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International Journal of Advanced Academic Studies

2020, Vol. 2, Issue 1, Part C

Litigation: A boon or bane for NPA in Indian banking sector


Author(s): Rumjhum Choudhary

Abstract: From a RBI study conducted in 1999, which though confined to only big borrowal accounts, it was inferred that the factors, responsible for creation of NPAs, external to the bank are more predominant than those attributable to the bank. In such a case the role of the Government and the RBI assumes critical importance in ensuring a credit market climate wherein the legal system is more responsive and there is sufficient deterrence to willful defaulters and those who take recourse to litigation for just buying time. Once such environment is created the NPAs levels for different banks will depend to a large extent on their own policies, systems, and judgements and perhaps will gravitate to reasonably low levels reflecting the time credit market risks. From the regulator’s perspective, there are four steps to the management of NPAs, viz., Assessment, Provisioning, Recovery and Prevention of fresh NPAs. This research paper highlights the legal recovery measures to control the NPA.

Pages: 193-196 | Views: 123 | Downloads: 38

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How to cite this article:
Rumjhum Choudhary. Litigation: A boon or bane for NPA in Indian banking sector. International Journal of Advanced Academic Studies. 2020; 2(1): 193-196.
International Journal of Advanced Academic Studies