Banks have reached out to the Reserve Bank seeking relaxation in recognition of non-performing assets in the MSME sector.
Banks want that a restructured MSME account under the Covid package be considered NPA from the latest date and not from the date prior to restructuring. This will give some relief to banks as it would lessen their provisioning burden.
This comes after, in certain cases, banks were told to treat such accounts as bad loans starting from when they were restructured and accordingly make provisions.
Source:
Economic Times
