A Study on Non-Performing Assets in Selected Non-Banking Financial Companies

Abstract: Non-Banking Financial Companies are integral to Indian economy as they are in a position to provide loans to areas which might not have access to banks or have not been receiving due attention from the banks. Some risks that NPAs have with regard to smooth operation and long-term survival of NBFCs. The risks originating from NPAs on the economical and efficient functioning of an NBFC come in different forms. In this research paper we would like to discuss the reasons of NPAs and the influence that NPAs have on the operations of the Non-Banking Financial Company. Various reasons for NPAs could include lack of rigorous credit appraisal system, over reliance on select few industries and macroeconomic factors.

Keywords: Non-Performing Assets, Non-Banking Financial Companies, Asset Quality, Risk Management, Credit Appraisal