NPA: Conceptual exposition

Abstract

Non-Performing Assets (NPAs) are such loans which dispersed by bank, to which borrower makes default in making payment of principal or interest amount. Whenever a bank is not in a position to recover the loan or regular interest on such a loan, the flow of fund in banking system is adversely affect, This dilemma related to Non-Performing Assets is distressing for the bank and for the economy of the country. An NPA is such loan assets, ceased to generate any income for the bank in the form of repayment of interest or principal.