Introduction: Non-Performing Assets (NPAs) are a steadily growing issue in the Indian banking sector, particularly in the private banking sphere, as they impact the viability of a given entity and its financial well-being significantly. This paper explores the recent increase in NPAs in the banks of the private sector in India and studies the key causation factors, the consequences that the NPAs have on the performance of the bank as well as the important remedial measures that can be adopted against the developing bad loans.

Methodology: This utilizes both primary and secondary data in the analysis with primary data collected via survey and secondary data collected via industry report. To outline the main NPA drivers, the mixed quantitative‐qualitative method was chosen, with economic recessions, predatory lending, and ineffective credit risk assessment being singled out as the most relevant ones. Moreover, the work determines to an extent how the problem of NPAs has been solved in the regulation process through regulatory interventions such as Insolvency and Bankruptcy Code (IBC) and the SARFAESI Act.

Findings: This is corroborated by the findings which indicate that, although some progress has been registered by the regulatory measures, several challenges like poor borrower profiling, sectoral concentration risks and the failure of its governance are still immense. As a result, the research has realistic suggestions: enhancing credit-risk management systems, utilizing technological tools that allow classifying loans and ensuring their control, bolstering governance mechanisms that prevent building up NPAs and long-term stability in the banking environment.