We at FinLender, exclusively provide funding for SMA Accounts (Special Mention Accounts are those assets/accounts that shows symptoms of bad asset quality in the first 90 days itself) , NPA Accounts, Distress Account and Finance for OTS.
What is the difference between NPA and SMA?
Remember that NPA has a duration of 90 days. On the other hand, the worst type of special mention account (SMA – 2) has less than 90 days’ duration. The Special Mention Account identification is an effort for early stress discovery of bank loans. It was introduced as a corrective action plan to contain stress. As per the SMA regulations, banks should identify potential stress in the account by creating a new sub-asset category viz. ‘Special Mention Accounts’ (SMA).