Non-performing asset

A non-performing asset is a loan or advance that a lender has classified as non-performing under the prudential norms of the Reserve Bank of India. The classification matters beyond the lender's books: enforcement under section 13 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 is available only once the account is a non-performing asset.

Even then the Act has floors. Section 31 excludes security interests below INR 1 lakh, security created in agricultural land, and cases where the amount due is less than twenty per cent of the principal and interest. Around the statute sits the Reserve Bank's prudential framework, consolidated into the Directions of 28 November 2025: a thirty-day review period after default, 180 days to implement a resolution plan, and additional provisioning of twenty and then thirty-five per cent where it is not implemented. The figures are stated as at 21 September 2026.