PSBs write off Rs 5.82-trn bad loans in 5 yrs

New Delhi: Public-sector banks (PSBs) have written off bad loans of about Rs5.82 lakh crore in the last five financial years, Parliament was informed on Tuesday. During 2024-25, the loan write-off of PSBs was at Rs91,260 crore, compared to Rs1.15 lakh crore in the previous fiscal, Minister of State (MoS) for Finance Pankaj Chaudhary said in a written reply to the Rajya Sabha. The write-off was highest at Rs1.33 lakh crore during 2020-21, declining to Rs1.16 lakh crore in the following year and to Rs1.27 lakh crore in 2022-23. In contrast to write-offs, PSBs have recovered around Rs1.65 lakh crore over the last five years.

Recovery is around 28 per cent of the total write-off in the previous five financial years. Banks write off NPAs, including those in respect of which full provisioning has been made on completion of four years, as per the Reserve Bank of India (RBI) guidelines and policy approved by banks’ Boards, Chaudhary said.

“Such write-off does not result in waiver of liabilities of borrowers and therefore, it does not benefit the borrower. The borrowers continue to be liable for repayment, and banks continue to pursue recovery actions initiated in these accounts,” he said.