One-time restructuring of stressed MSME accounts
By Simran Jalan (email@example.com)
The Non-Performing Asset (NPA) rates in the Micro, Small and Medium Enterprises (MSMEs) segment have remained stable and range bound. In the Micro segment the NPA rate has moved from 8.9% in March, 2017 to 8.8% in March, 2018. In SME segment, the NPA rate hovered between 11.4% in march, 2017 to 11.2% in March, 2018. Recognised NPA exposure for MSMEs is Rs. 81,000 crores as on March, 2018. While the growth in the NPA rate has moderated, it is too early to conclude that the NPA problem is close to bottoming out.
The RBI, in its board meeting held on November 19, 2018, was advised by the Board to consider a scheme of restructuring of stressed standard assets of MSME borrowers with aggregate credit facilities of up to Rs. 25 crores, subject to such conditions as are necessary for ensuring financial stability.