NPA Provisioning Calculator
Classify assets under RBI IRAC norms (Standard, Sub-Standard, Doubtful I/II/III, Loss) and compute mandatory provisioning requirements with audit-ready statement generation.
NPA Provisioning Wizard (RBI IRAC Norms)
Step 1 of 3RBI Provision Coverage Ratio (PCR)
RBI mandates banks to maintain a healthy PCR (typically 70% or higher across total bad loans). Higher PCR protects balance sheets against write-offs and resolution haircuts under IBC / NCLT.
Aging of Doubtful Assets
D2 (36–60 mo): 40% secured, 100% unsecured.
D3 (> 60 mo): 100% secured & 100% unsecured.
Frequently Asked Questions on NPA Provisioning
What is NPA provisioning in banking?
NPA provisioning is the mandatory setting aside of funds by banks out of their operating profit to cushion against expected credit losses on non-performing loans, calculated as per RBI's IRAC norms.
What are the RBI provisioning rates for Sub-Standard assets?
Sub-Standard assets (classified as NPA for 12 months or less) attract a 15% provision on the secured portion and a 25% provision on the unsecured portion.
What are the rates for Doubtful assets (D1, D2, D3)?
D1 (12–36 months): 25% secured, 100% unsecured. D2 (36–60 months): 40% secured, 100% unsecured. D3 (over 60 months): 100% on both secured and unsecured portions.
What is Provision Coverage Ratio (PCR)?
PCR is the ratio of total loan loss provisions held by a bank to its Gross NPAs, expressed as a percentage. RBI encourages a minimum system-level PCR of 70% to ensure financial resilience.
Are standard assets required to be provisioned?
Yes, RBI requires a general provision of 0.25% on standard domestic commercial loans (higher for commercial real estate at 1.00% and housing loans at teaser rates).
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