Banks have written off bad loans worth Rs 1.15 lakh crore in the first three quarters or nine months of the current fiscal year, the central government told Lok Sabha on Monday (March 8th).
“In accordance with RBI guidelines and policy approved by bank boards, non-performing loans, including those for which full provision has been made after four years, are removed from the bank’s balance sheet. concerned by the -off, ”said Minister of State for Finance Anurag Singh Thakur in a written response.
“Banks assess the impact of write-offs as part of their regular exercise to clean up their balance sheets, enjoy tax benefits and optimize capital in accordance with RBI guidelines and policy approved by their boards of directors,” said he declared.
The minister said that according to RBI data, Scheduled Commercial Banks (SCBs) have written off loans of Rs 2.36.265 crore, Rs 2.34.170 crore and Rs 1.15.038 crore in fiscal year 2018- 19, fiscal year 2019-20 and the first three – quarters of fiscal year 2020-21 respectively, reported Thread.
Emphasizing the collection of canceled bank loans, the minister said that according to RBI guidelines, banks should have a loan collection policy that mentions the mode of collection of contributions, a targeted level of reduction of fees. non-productive assets by period.
“A number of collection mechanisms are available to banks to effect collections, such as filing a complaint in civil courts or debt collection courts, an action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, filing of files with the National Company Law Tribunal under the Insolvency and Bankruptcy Code of 2016, through a negotiated settlement / compromise and through the sale of non-productive assets ”, declared the Minister.
According to RBI data, in the last two fiscal years and the first three quarters of the current fiscal year, SCBs have recovered an amount worth Rs 3,686,636 crore, including the recovery of Rs. 68,219. Rupee crores on written off loan accounts.
Thakur also said that banks’ non-performing assets had decreased from Rs 2,79,627 crore to Rs 7,56,560 crore as of December 31, 2020, thanks to the government’s system of recognition, resolution, recapitalization and reforms.
In response to another question, Thakur also said that various measures have been used to control unauthorized digital lending platforms.
The Department of Electronics and Information Technology blocked 27 loan applications under Section 69A of the Information Technology Act 2000 to prevent fraudulent activities by lenders, Thakur said.