IMPACT OF COVID-19 ON BANKING IN INDIA : AN EMPIRICAL ANALYSIS

Abstract

The COVID-19 outbreak has challenged Indian Banking sector adversely. The pandemic is impacting the Banking sector in multiple ways — from business continuity issues and operational considerations to the overall financial outlook.Indian Banks reported Increase in NPAs, demand of credit and in turn impacted profitability. Because of the shutdown, there were no source of Revenue and expenses were increasing. So, People were demanding advances and on the other hand they were not able to repay the loan. So, liquidity crisis arose. To overcome this situation, Reserve bank of India and central Government has taken many measures to provide relief. This Research Paper is an attempt to analyse the relationship between NPAs, Advances and Profitability due to COVID-19 and also impact of measures taken by RBI and government in Indian Banking sector. For the purpose, we have analysed four Indian Banks i.e. SBI, Bank of Baroda, HDFC Bank, Axis Bank for a period of 5 years from 2014-15 to 2019-20. The data was analysed using statistical tools like correlation coefficient to examine the impact of NPAs and Advances on profitability. some experts believe that Banking sector mainly in India may take long time to recover from the impact of this pandemic.