Banks’ Rs 9.75 Lakh Crore Loan Write-Offs Put India’s Bad-Loan Clean-Up Back In Focus

Nutgraf: A fresh Parliament reply has put bank write-offs back in the spotlight, showing how India cleaned up legacy stress while still chasing recoveries from defaulting borrowers.

Indian banks wrote off Rs 9.75 lakh crore in loans over 11 financial years from FY15 to FY25, according to Lok Sabha Unstarred Question No. 3748, answered on 16 March 2026 by Minister of State for Finance Pankaj Chaudhary. 

The number has drawn attention because write-offs are often read as relief for defaulters. The government’s reply says otherwise: borrowers remain liable, and banks continue recovery action. News reports by The Economic Times, NDTV Profit and ET Now tracked the same parliamentary disclosure.

How The Write-Off Build-Up Looks?

The official reply shows the Large Industries and Services category accounted for Rs 9,74,515 crore, effectively the full Rs 9.75 lakh crore headline number. The annual figure rose from Rs 31,723 crore in FY15 to a peak of Rs 1,59,139 crore in FY20, then fell to Rs 47,568 crore in FY25.
 

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The pattern shows two things. First, the heaviest clean-up came after the corporate bad-loan cycle that hit infrastructure, metals and related sectors. Second, the latest years show easing pressure compared with the FY20 peak. Reports by PTI, The Telegraph and Millennium Post reflect the same downward trend after FY20.
 

That headline number, however, is narrower than the full category-wise banking picture placed before Parliament.

What Changed Over Time?

A separate category-wise reading of the same Finance Ministry data, reported by The Indian Express on 16 March 2026, shows total write-offs across segments reached Rs 19.05 lakh crore over the same 11-year period, with Rs 1.72 lakh crore written off in FY25 alone. 

It also showed a shift in stress from old corporate accounts to household-facing credit. For the first time, retail loans became the top write-off segment in FY25 at Rs 45,404 crore. 
 

Rs 37,716 crore

MSMEs

Rs 28,587 crore

Agriculture

Rs 21,882 crore

That shift has widened the conversation. A LoansJagat analysis published on 17 March 2026 said the gap between the Rs 9.75 lakh crore and Rs 19.05 lakh crore figures shows why readers must check which category set is being cited. Its takeaway was direct: write-offs are not waivers, but the composition of write-offs now deserves closer scrutiny.