Retail and MSMEs likely to see rise in slippages, say bankers

The current level of NPAs masks the actual pain due to restructuring done under regulatory packages, both in 2020 and this year

Asset quality of lenders did not see a sharp uptick despite severe economic disruptions due to Covid-19 in 2020 and 2021 on timely regulatory steps like restructuring and liquidity support.
 
Now, owing to the present economic recovery phase, households and micro, small and medium enterprises (MSMEs) saw a rise in defaults due to the end of payment moratorium and delayed business payments, said bankers.
 
Rating agency CRISIL has estimated that stressed assets — non-performing assets and restructured loans — in banks’ portfolios could touch 11 per cent by March 2022, up from 9 per cent in March 2021.