Open Accessstudy on impact of PSL on gross NPAS of nationalised banks: an empirical approach
Author(s) -
Karona Cahya Susena,
Miftachul Huda,
Andino Maseleno,
Bibhu Prasad Sahoo,
Karman Kaur
Publication year - 2021
Publication title -
linguistics and culture review
Language(s) - English
Resource type - Journals
ISSN - 2690-103X
DOI - 10.21744/lingcure.v5ns3.1365
Subject(s) - non performing asset , non performing loan , order (exchange) , economic sector , financial system , business , gross domestic product , economics , finance , economy , economic growth , loan , capital asset pricing model
In order to encourage banks to lend more to neglected areas of the economy, the idea of a priority sector was introduced. These priority sectors add significantly to gross domestic product but have not received sufficient finance to function adequately. However, lending in the priority sector is not very warmly welcomed by the banks, particularly nationalized banks in India, as they generate more nonperforming assets than other sectors. It is the priority sector that contributes to the biggest default. As far as NPAs on account lending to the priority sector are concerned, it has been observed that there are inefficiencies in this sector, such that the fresh loans turning bad. Thus, our study examines the impact of non-priority sector loans on the rise of NPAs in the nationalized banks.