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NPA- The truth

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Author, Writer, Educationist. Counsellor, AOL faculty, Electrical Engineer

We are witnessing lot of information being spread in social media about loan written off for big industrialists or people shown close to PM Modi by main stream media. The ultimate purpose is to show PM Modi is corrupt and dancing to the tunes of these biggies.

First, Let’s understand the difference between written off and waive off in simple terms.

If someone has borrowed Rs 100 from you this month but unable to pay you back during the financial year as promised, you will write off this amount from your balance sheet as per standard accounting practice followed for long (not discovered by PM Modi) but you will still chase him to get back your money and you can use legal options against him if he is not following the agreement/contract.

In case of waive off, you are completely letting him go to pay a particular amount and there shall be no legal consequences against debtor. Loan waive off for farmers is the right example.

Let’s go back before 2014 when PM Modi was not in power, many social media experts and politicians were not aware how these NPA’s generated. (Non-Performing Assets), as per RBI report and information given by FM Nirmala Sitharaman, Gross advances of the state owned bank increased from Rs 18.19 lakh crore in FY 2008 to Rs 52.16 lakh crore as on FY 2014 (before PM Modi). She also informed that this aggressive lending practices, wilful default, corruption in some cases and economic slowdown led to spurt in stressed assets.

It was easier for PM Modi after elected in May 2014 to come forward and release a white paper with facts and figures how economy is handed over to him and mention that he can’t do much for next 5 years. PM Modi is known for working in adversities and a man of action. He has decided to take this as challenge and started working with then FM Late Shri Arun Jaitely. It was right on his part that he didn’t hide about NPA but brought it to the forefront for actions. Mentioning few steps to know the actions taken;

  1. The IBC (Insolvency and Bankruptcy code), SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) act and stressed asset management verticals…
  2. The government has taken comprehensive steps under it’s 4R’s strategy,
  3. Recognising NPA’s transparently
  4. Resolving and Recovering value from stressed accounts
  5. Recapitalising PSB’s
  6. Reforms in banks and financial ecosystem to ensure a responsible and clean system.

These various initiatives helped government with PSB’s to recover Rs 3.59 lakh crore till April 2019. These were written off but still recovered. Hence, do not mix waive off with written off. The process is going on and nobody shall be spared by PM Modi within the boundaries of the law of land, that’s why fear mongering and creating a fake news with distorted data is circulated on different platform to malign his image. Ultimately, this helps social media warriors to study deeply about these allegations against PM Modi to dig out real information about corruption or malpractices followed in the past by the bosses of fake news creators.

First is recovery of the stressed assets and most important is to obstruct creation of such assets in future. The technological advancements in banking sector and laws made by government, making it full proof mechanism. If you talk to senior officials of any bank, they are feeling relieved due to systems being implemented with new laws enforced. No politician, minister or bureaucrat can call and order them to sanction loan for their near and dear ones. So, we are gradually moving towards an honest and clean system.

I would like to request social media friends, refrain yourselves from these 5 points against PM Modi, you will be wasting your time and energy;

  1. Corruption charges
  2. Family first
  3. Sexual allegations
  4. Holidaying
  5. His hardwork and love for our lovely nation.

Pankaj Jagannath Jayswal
Author, Educationist, counsellor, Motivational speaker, AOL Faculty,  Electrical Engineer.
Coming books in May: Youth: Reflection of Universe in English and in Hindi Yuva:Bramhand ka Pratibimb

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Author, Writer, Educationist. Counsellor, AOL faculty, Electrical Engineer
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