RBI extends deadline for NBFCS to meet new NPA upgradation norms
The Reserve Bank of India on 15 February, 2022 extended the timeline by six months for NBFCs to adhere the new NPA recognition norms. Earlier the regulator had set 31 March, 2022 deadline for non-bank lenders to upgrade NPAs only after all arrears and principal dues are paid. The NDFCs will now have time till 30 September, 2022 to put in place the necessary systems to implement the new NPA recognition norms.
The RBI also clarified that loans classified as NPA will be upgraded to standard category.
“In case of borrowers having more than one credit facility from a lending institution, loan accounts shall be upgraded from NPA to standard asset category only upon repayment of entire arrears of interest and principal pertaining to all the credit facilities,” the RBI said.
The new RBI rules require NBFCs to treat such accounts as NPA until the borrower updates the account by paying all the EMIs due.