Supreme Court lifts blanket ban on NPA classification

The Supreme Court has also ordered waiver of compound interest for all borrowers who availed the loan moratorium

The Supreme Court on Tuesday said the interim relief granted earlier to not declare the accounts of respective borrowers as non-performing assets stands vacated, ending the blanket ban on classification of non-performing assets (NPAs).

“However, there shall be no order as to costs,” the order by the top court said.

In September last year, the Supreme Court had directed that accounts not declared NPAs as of August 31 should not be classified as such until further orders. This has since then put an effective ban on classification of bad loans.

The Supreme Court has also ordered waiver of compound interest