PSBs write off loans worth Rs 6.15L cr in last 5.5 years
New Delhi: Public sector banks have written off loans totalling Rs 6.15 lakh crore over the past five and a half years, the government told Parliament on Monday. Citing provisional figures from the Reserve Bank of India, Minister of State for Finance Pankaj Chaudhary informed the Lok Sabha that public sector banks wrote off Rs 6,15,647 crore between FY2020 and September 30, 2025.
Chaudhary noted that the Centre has not infused capital into public sector lenders since FY2022-23. According to him, the banks have “turned profitable and strengthened their capital position”, enabling them to meet capital needs through market borrowing and internal resources. Since April 1, 2022, PSBs have mobilised Rs 1.79 lakh crore via equity and bond issuances.
Explaining the rationale behind write-offs, the minister said banks follow RBI norms that permit the removal of fully provisioned non-performing assets after four years. “Such write-off does not result in waiver of liabilities of borrowers to repay,” he said, adding that recovery efforts continue through civil courts, Debts Recovery Tribunals, proceedings under the SARFAESI Act, and insolvency cases before the National Company Law Tribunal.
Chaudhary added that write-offs do not strain liquidity because provisioning has already been completed. Banks, he said, also review write-offs as part of routine balance sheet clean-ups and to secure tax benefits, improve capital efficiency, expand lending potential and support investor sentiment.
Responding to a separate query, he said public sector banks, SIDBI and Exim Bank disbursed Rs 21.71 lakh crore in export credit between FY2020-21 and FY2024-25, reinforcing their role as the primary source of export finance.
In another reply, Chaudhary reported that 5,83,291 fraud cases amounting to Rs 3,588.22 crore were recorded over the last four and a half years till September 2025, of which Rs 238.83 crore has been recovered. He added that the growth of digital transactions has coincided with a rise in cyber and digital payment frauds.
