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    <title>Spectre of default, credit pain may tail banks next year too</title>
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    <description>Demonetisation-induced cash withdrawal disrupted banking operations and materially strained asset quality by constricting liquidity for borrowers and diverting bank resources to currency exchange. This caused a pronounced escalation in non-performing assets across lenders, a rise in wilful defaulters, and a sharp fall in credit demand and credit growth. Government recapitalisation and regulatory relief, including repayment extensions for small loans, were deployed, but further NPA deterioration is anticipated as the cash shortage&#039;s full effects on loan repayment materialise.</description>
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