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Minister of State for Finance Pankaj Chaudhary has said that banks have written off loans worth Rs 9.90 trillion in the last five financial years. During 2023-24, banks loan write off was at Rs 1.70 trillion, as against Rs 2.08 trillion in the previous fiscal. Write-off was highest at Rs 2.34 trillion during 2019-20, which came down to Rs 2.02 trillion in the following year and to Rs 1.74 trillion in 2021-22. 

He said as per the RBI guidelines and policy approved by banks' boards, NPAs, including those in respect of which full provisioning has been made on completion of four years, are removed from the balance-sheet of the bank concerned by way of write-off. Banks evaluate/consider the impact of write-offs as part of their regular exercise to clean up their balance-sheet, avail tax benefit and optimise capital, in accordance with the said guidelines and policies of the respective boards. Such write-off does not result in waiver of liabilities of borrowers to repay and therefore, write-off does not benefit the borrowers. The borrowers of written-off loans continue to be liable for repayment and banks continue to pursue recovery actions initiated in written-off accounts through various recovery mechanisms available to them. 

The minister said against Rs 9.9 trillion write-off, recovery was to the tune of Rs 1.84 trillion, or just 18 per cent of total write-off during the last 5 years. As per the Reserve Bank of India (RBI) data, he said gross NPAs (GNPA) of Scheduled Commercial Banks (SCBs) was Rs 8,96,082 crore (GNPA ratio of 8.21 per cent) as on March 31, 2020, Rs 8,35,051 crore (GNPA ratio of 7.33 per cent) as on March 31, 2021, Rs 7,42,397 crore (GNPA ratio of 5.82 per cent) as on March 31, 2022. It further came down to Rs 5,71,544 crore (GNPA ratio of 3.87 per cent) as on March 31, 2023 and to Rs 4,80,687 crore (GNPA ratio of 2.75 per cent) as on March 31, 2024 (provisional data). He added that it indicates that gross NPAs in SCBs have been declining over the past five years.