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Bad loans on the mind, here’s what the government may do to solve the problem – there is a credit problem and the NPA problem. including the amount of haircut the banks will take in case bad loans are sold during auctions. Several top office bearers have recently highlighted.
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In some cases, the government does not lend money directly. Instead, loans are offered by lenders (like banks and finance companies) and backed by the U.S. government: the government promises to repay if you, the borrower, fail to do so. That guarantee reduces the risk for lenders and makes them more willing to lend at attractive rates, and they’re also more willing to lend in situations.
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