Bring banks on track

Credit market ecosystem needs better governance and oversight

The banking sector is showing signs of a turnaround, though challenges remain. The latest Financial Stability Report (FSR) of the Reserve Bank of India (RBI) says that gross non-performing assets (GNPA) of scheduled commercial banks could rise from 9.3 per cent in September 2019 to 9.9 per cent in September 2020, largely due to change in macroeconomic conditions, marginal rise in slippages, and declining credit growth. Slower economic growth is a risk for both the banking and non-banking financial sectors. Nominal growth in the Indian economy slipped to 6.1 per cent in the second quarter of the current fiscal year