IMPACT OF NON-PERFORMING ASSET RECOVERY ON THE GROWTH TRAJECTORY OF CO-OPERATIVE BANKS IN GADCHIROLI DISTRICT

Abstract

As part of this study, the effects of the co-operative bank growth path and the Non Performing Assets (NPA) recovery in Gadchiroli District have been analysed in this research paper. Co operative banks, particularly in rural and underdeveloped regions where banks have strong dependence on agricultural loans, have been facing significant challenge from NPAs. This paper probes into the different NPA recovery mechanisms employed by the co-operative banks of Gadchiroli such as debt restructuring, legal recourse, recovery camps and integration of digital tools for risk management. The research is undertaken using quantitative and qualitative methods that analyse the financial performance indicators of 45 co-operative banks pre and post implementing these NPA recovery strategies. Looking at the financial metrics, the results show that after the introduction of NPA recovery mechanisms, we see improvements in some of these metrics, namely Net Profit Margin, Return on Assets (ROA), Loan Growth, Recovery Rate and reductions in Gross NPAs. The study finds that co-operative bank’s financial stability and growth depend on effective NPA management as a means of lending development and regional economic growth. The work also outlines the challenges that come with these banks, including limited access to sophisticated financial technologies and inadequate training of bank personnel. The findings provide insights for policy makers and stakeholders including financial institutions to improve the NPA recovery process and foster the long term development of the co op banks in rural Indian.