PHASES AND DIMENSIONS OF NON-PERFORMING ASSETS IN INDIAN BANKING SYSTEM: LEGAL RESPONSE
The linchpin of any country’s economy is its banking system. For an economic system to sustain, it is of utmost significance that the growth of the banking system is fast and at the same time, stable. The banking system of India, on the other hand, has been rendered to a lot of susceptibilities in the recent years owing to the globalised economic environment. One of the prime issues pertaining to the stability of the Indian banking system is the Non-Performing Assets (NPAs). A loan is characterized as a Non-Performing Asset if the borrower does not repay its principal along with interest payments for 90 days. It tends to block capital, thus reducing the earning capacity of the assets. As a consequence of such reduction, return on assets tends to get affected.