Cash Credit and Overdraft classified as Non-Performing Assets if it is "Out of Order" as per New guidelines of Reserve Bank of India. Discuss.

Cash Credit/Overdraft is classified as NPA if it is 'Out of Order'. An account should be treated as 'Out of Order' if: The outstanding balances in the cash credit and overdraft account remains continuously in excess of the sanctioned limit/drawing power for 90 days. The outstanding balance in the cash credit and overdraft account is less than the sanctioned limit/drawing power but there are no credits continuously for 90 days or the outstanding balance in the cash credit and overdraft account is less than the sanctioned limit drawing power but credits are not enough to cover the interest debited during the previous 90 days. The definition out of order is clarified in circular issued on February 15, 2022 shall be applicable to all loan products being offered as an overdraft facility, including those not mean for business purposes and or which entail interest repayments as the only credits. The Previous 90 day's period for determination of out of order status of a cash credit and overdraft account shall be inclusive of the day for which the day end process is being run. In case of borrowings have more than one credit facility from a lending institution, loan accounts shall be upgraded from Non-Performing Assets to standard asset category only upon repayment of entire arrears of interest and principal pertaining to all the credit facilities.