Abstract This paper focuses on the non-Performing assets of NBFI’s in India. The reasons, problems and impact of NPAs have been given due importance. An asset is classified as Non-performing Asset (NPA) if dues in the form of principal and interests are not paid by the borrower for a period of 90 days. Nonperforming asset is a term very frequently used by lending institutions. The reasons for NPAs may be wrong selection of borrower, non scrutiny of units, delay in sanction of loans etc. Due to several steps taken by the RBI, NPAs have reduced considerably. Foreign experiences must also be used along with a clear understanding of the local conditions to create a tailor- made solution which is transparent and fair to all stakeholders. Though NPAs have been reduced to some extent, it should be kept in mind that it will not raise further in the future.
Keywords: Asset; Impact; Loans; NBFIs; Non-performing assets; Recovery