RBI asks banks to standardise NPAs only on full interest, principal payments.

The Reserve Bank of India (RBI) has directed banks that that loan accounts classified as non-performing assets (NPAs) should be upgraded as ‘standard’ asset only if entire arrears of interest and principal are paid by the borrower.

According to the central bank, some lending institutions upgrade accounts classified as NPAs to ‘standard’ asset category upon payment of only interest overdues and partial overdues.