Customer how to go in NPA, written off

Question

Accepted Answer

Customers go into NPA (Non-Performing Assets) or written off when they fail to repay their loans for a certain period of time.

NPA is a loan or advance for which the principal or interest payment remains overdue for a period of 90 days.
Written off is when the bank or lender removes the loan from its books as an asset and declares it as a loss.
Customers can go into NPA or written off due to various reasons such as financial difficulties, job loss, or business failure.
Banks and lenders have a recovery process in place to recover the outstanding amount from customers who have gone into NPA or written off.

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