What changed
RBI standardized the NPA classification for credit card accounts: an account is NPA if the minimum amount due is not paid fully within 90 days from the next statement date. Previously, banks used different dates (due date vs. billing date) to determine overdue status, causing inconsistency.
What it means for you
Banks must now uniformly treat credit card accounts as NPAs after 90 days from the next statement date if the minimum due is unpaid. This aligns reporting to credit bureaus and late fee calculations, reducing ambiguity. Lenders need to adjust their systems to track this specific timeline for provisioning and regulatory compliance.
What you must do
- Update credit card systems to flag accounts as NPA if minimum amount due is unpaid within 90 days from the next statement date.
- Ensure the gap between two consecutive statements does not exceed one month.
- Align reporting to credit information companies and late payment charge calculations with this uniform overdue determination method.
- Train credit card operations and risk teams on the new NPA trigger date.
Who it affects
All scheduled commercial banks issuing credit cards, Credit card operations and risk management teams, Credit information companies receiving credit card data
What is the exact trigger for classifying a credit card account as NPA under this circular?
A credit card account becomes NPA if the minimum amount due, as shown in the statement, is not paid fully within 90 days from the next statement date. The gap between statements must not exceed one month.
Does this circular change how late payment charges are levied?
Yes, banks must use this uniform method (90 days from next statement date) for determining overdue status when levying late payment charges and reporting to credit bureaus.