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      Question

      As per RBI norms on agricultural advances, a loan

      granted for long duration crops will be classified as a Non-Performing Asset (NPA) if the instalment of principal or interest remains overdue for:
      A 90 days Correct Answer Incorrect Answer
      B 180 days Correct Answer Incorrect Answer
      C One crop season Correct Answer Incorrect Answer
      D Two crop seasons Correct Answer Incorrect Answer
      E 360 days Correct Answer Incorrect Answer

      Solution

      RBI has set separate norms for agricultural loans: тАв Short-duration crops (crop season up to 1 year): The loan is treated as NPA if overdue for two crop seasons. тАв Long-duration crops (crop season longer than 1 year): The loan is treated as NPA if overdue for one crop season. The definition of crop season (i.e., the period up to harvesting) is decided by the State Level BankersтАЩ Committee (SLBC) for each state. Thus, for long-duration crops, even one missed crop season makes the loan non-performing.

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