NPAs of banks declined to record low

New Delhi: The gross NPAs as a percentage of total loans and advances of scheduled commercial banks have been continuously declining during the last eight financial years, and were at a historic low of 2.15 per cent at the end of September 2025, which is lower than the 2010-11 level, the Parliament was informed on Monday.

The Reserve Bank of India (RBI) has apprised that the data on gross NPAs of banks is not collected by it on a monthly basis. However, as per the latest data available with the apex bank, as on September 30, 2025, for domestic operations, the gross NPA ratio of scheduled commercial banks was 2.15 per cent. In the case of public sector banks, the gross NPA ratio was 2.50 per cent, while for private sector banks it was 1.73 per cent, and for foreign banks the figure stood at 0.8 per cent.

Also, public sector banks recorded a higher decline in gross NPA ratio in comparison with private banks and foreign banks since March 2018, Minister of State for Finance Pankaj Chaudhary said in a written reply to a question in the Lok Sabha.

This continuous decline in gross NPAs of banks has led to reduced provisioning by them, which in turn has improved their profitability, thereby causing a positive impact on business growth. It also indicates that the asset quality, as well as underwriting, has improved in PSBs supported by a strong balance sheet and sustained profitability, the minister said.