Which of the following terms is used to describe loans that are in default or close to being in default, categorised by RBI as Sub-standard, Doubtful, or Loss assets?

💡 Solution & Explanation

Non-Performing Assets refer to credit facilities or commercial loans where interest or principal installments remain overdue for a period exceeding 90 days, prompting banks to classify them as sub-standard, doubtful, or loss assets. Stressed assets represent a broader category inclusive of restructured loans and written-off assets. Banking exams consistently emphasize asset classification norms established by the Reserve Bank of India to maintain financial stability.