non performing assets in India

When it comes to the management of non performing assets in India, there is no better consultancy that you can turn to for the purpose besides us.

What is meant by the term non performing asset?
A non performing asset is one that falls under one of the categories mentioned below.

·         With respect to a term loan: a loan/ advance for which the installment of the principal amount and/or the interest is overdue for a period exceeding 90 days.

·         With respect to a cash Credit (CC/ OD) or overdraft: the account is overdue for a period exceeding 90 days.

·         With respect to purchased and discounted bills: the bill is overdue for a period exceeding 90 days.

·         With respect to an advance relating to an agricultural purpose: the installment of the principal amount and/ or the interest is overdue for 2 harvest seasons, but not exceeding 2 half years.

·         With respect to other cases: any amount which is yet to be received is overdue for a period exceeding 90 days.

Apart from being a reputed NPA consultancy, we also provide various other services, including alternate finance arrangements, bank settlements etc. With a number of prestigious awards and merits that certify just how commendable our services are, our consultancy is your best bet when it come to efficient handling of corporate law.

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Non-performing assets, also called non-performing loans, are loans,made by a bank or finance company, on which repayments or interest payments are not being made on time.

A loan is an asset for a bank as the interest payments and the repayment of theprincipal create a stream of cash flows. It is from the interest payments than a bank makes its profits.

Banks usually treat assets as non-performing if they are not serviced for some time. If payments are late for a short time a loan is classified as past due. Once a payment becomes really late (usually 90 days) the loan classified as non-performing.

A high level of non-performing assets compared to similar lenders may be a sign of problems, as may a sudden increase. However this needs to be looked at in the context of the type of lending being done. Some banks lend to higher risk customers than others and therefore tend to have a higher proportion of non-performing debt, but will make up for this by charging borrowers higher interest rates, increasing spreads. A mortgage lender will almost certainly have lower non-performing assets than a credit card specialist, but the latter will have higher spreads and may well make a bigger profit on the same assets, even if it eventually has to write off the non-performing loans.