Rs 17.5 lakh crore bad loans written-off in past 10 years by Indian banks: Govt
The Indian government has disclosed that scheduled commercial banks (SCBs) have written off a staggering ₹17.5 lakh crore in bad loans over the last ten financial years. This revelation came in response to a starred question in the Lok Sabha by MP Amra Ram, who sought details on loans written off by large corporate houses and the recovery efforts undertaken by banks.
Finance Minister Nirmala Sitharaman, in her written response, clarified that while banks write off NPAs as per Reserve Bank of India (RBI) guidelines, this does not equate to a waiver of liabilities for borrowers. Banks continue to pursue recovery actions through various mechanisms, including legal proceedings under the Insolvency and Bankruptcy Code (IBC), Debt Recovery Tribunals (DRTs), and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act.
Key Highlights:
- Total NPAs Written Off (2014-15 to 2023-24): ₹17.5 lakh crore
- NPAs Written Off in ‘Large Industries and Services’: ₹9.28 lakh crore
- Top Year for Write-offs: 2018-19, with ₹2.36 lakh crore written off
- Current NPA Status: As of December 31, 2024, 29 unique borrower companies have NPAs of ₹1,000 crore or more, with an aggregate outstanding of ₹61,027 crore.
Year-wise Breakdown of NPAs Written Off:
| Financial Year | Total NPAs Written Off (₹ crore) | NPAs Written Off in ‘Large Industries and Services’ (₹ crore) |
|---|---|---|
| 2014-15 | 58,786 | 31,723 |
| 2015-16 | 70,413 | 40,416 |
| 2016-17 | 1,08,373 | 68,308 |
| 2017-18 | 1,61,328 | 99,132 |
| 2018-19 | 2,36,265 | 1,48,753 |
| 2019-20 | 2,34,170 | 1,59,139 |
| 2020-21 | 2,04,272 | 1,27,050 |
| 2021-22 | 1,75,178 | 69,532 |
| 2022-23 | 2,16,324 | 1,14,528 |
| 2023-24 | 1,70,270 | 68,366 |
Recovery Efforts:
The Finance Minister emphasized that write-offs are a technical exercise and do not absolve borrowers of their liabilities. Banks continue to pursue recovery through:
- Filing suits in civil courts and DRTs
- Initiating action under the SARFAESI Act
- Approaching the National Company Law Tribunal (NCLT) for corporate insolvency resolution under the IBC
Challenges in Disclosure:
The RBI does not maintain borrower-wise credit information due to confidentiality provisions under Section 45E of the RBI Act, 1934. As a result, the government could not provide company-wise details of loans written off.
The data highlights the significant challenge of NPAs faced by Indian banks over the past decade. While write-offs help banks clean up their balance sheets, the government and regulators continue to focus on recovery mechanisms to ensure that borrowers repay their dues.
Also See: IBC helped recovery of 14% bad loans in FY24: SBI Annual Report
