What are the Causes of Non-Performing Assets (NPAs) and What Preventative Measures Are in Place?

Abstract

This paper looks at how Indian banks handle NPAs to help you understand the problems and possible answers for getting rid of NPAs. This paper talks about what banks and other financial companies have done to make sure that non-performing assets don't hurt their day-to-day business. Indian banks must work hard on non-performing assets in order to reach two important goals: stable money supply and steady economic growth. The study's results are useful for politicians, lawmakers, and financial companies that need to deal with assets that aren't making money. This detailed study uses secondary sources to look at how banks try to get their money back from short-term loans and payments so that their non-performing assets go down. Since banks need a steady flow of cash, they have to come up with creative ways to pay back these short-term loans. The term "non-performing assets" refers to assets that aren't working as well as they should, which hurts credit conditions and the amount of risk that is wanted. Researchers have come up with new ways to handle credit and short-term loans in order to lower the number of assets that aren't being paid back. Even so, there isn't a lot of academic writing about the broad topic of credit and short-term loans and assets that aren't being paid back. One thing that makes this problem stand out is that the study looks at non-performing assets from a new angle and is based on first-hand reports. One problem with the study is that it didn't delve deeply enough into one type of financial organization. In general, the results of this study can be used for all kinds of financial companies, whether they are personally or publicly owned.