Asset Reconstruction Company (India) Ltd. IPO

Banking and NBFC sectors analysis
As of March 31, 2025, India’s commercial banking sector consists of 12 Public sector banks (“PSBs”), 21 Private sector banks (“PVBs”), 44 foreign banks (“FBs”), 11 Small Finance Banks ... (“SFBs”), 6 Payments Banks (“PBs”), 43 Regional Rural Banks (“RRBs”), and 2 Local Area Banks (“LABs”) as per the latest RBI Banking Trends Report released in December 2025. Out of these 139 commercial banks, 135 were classified as scheduled banks, while 4 were non-scheduled commercial banks. Similarly, NBFCs (including HFCs) registered with Reserve Bank of India (“RBI”) are classified into top, upper, middle and base layers, based on their size, activity, and perceived riskiness. As of March 31, 2025, there are 15 Upper layer, 656 Middle layer, and 8711 base layer NBFCs registered with the RBI. Furthermore, there were 27 Asset Reconstruction Companies (“ARCs”) registered with the RBI as on December 31, 2025. Stressed Assets in Indian Credit System Process of Classification of Asset into NPA, as per guidelines Banks/FIs use the Special Mention Account (“SMA”) classification to identify loan accounts showing early signs of stress and potential risk of becoming Non-Performing Assets (“NPAs”). This categorization serves as an early warning signal in the loan monitoring process, enabling proactive monitoring, and addressing potential credit risks. An account is flagged as "overdue" and classified as an SMA when full payment is not received by the due date. For example, if a housing loan EMI is due on March 31, 2026, and payment is not received before the bank's day-end process, the account will be considered overdue and classified as an SMA from March 31, 2026. Read more