IDEAS home Printed from https://ideas.repec.org/h/spr/sprchp/978-981-96-1785-2_8.html
   My bibliography  Save this book chapter

Spreading of Digital Banking in India and Its Impact on Credit Risk During the Era of Covid-19

In: Resurgence and Sustainable Development of Asian Markets in the New Normal

Author

Listed:
  • Sanjoy Laha

    (University of Engineering and Management Kolkata)

  • Rabin Mazumder

    (Kolkata, University of Engineering and Management)

Abstract

The paper highlighted on the impact of digital banking towards credit risk of the commercial banks in India. The digital banking parameters are represented by various financial ratios and the credit risk is represented by the net nonperforming asset to net advance ratio (NPA). Firstly paired t test has conducted to make a comparative view of understanding the influence of digital banking on financial indicators during pre and post Covid-19 era. To show the financial indicators those influenced the credit risk, proxied by NPA is represented by ordinary least square (OLS) regression analysis. But to get an unbiased result, Generalised methods of moments (GMM) analysis has been applied on the data set. Here credit deposit ratio (CRDEP), priority sector advances to total advances ratio (PRATT_ADV), ratio of term loans to total advances (TRMLN_ADV), ratio of secured advances to total advances (SECADT_ADV), ratio of interest income to total assets (II_TOTAST), cost of deposits (COD), cost of funds (COF), return on investments (ROINV), return on investments adjusted to cost of funds (ROINVADJTCOF) and capital adequacy ratio (CAR) are considered as independent variables and NPA as the dependent variable. The outcome of the analysis has shown that only TRMLN_ADV is negatively related with NPA. So, the research results show that the digital banking helps to mitigate credit risk by increasing loan disbursement. To control the credit risk especially NPA, the banking authority and government should take a firm initiative and set a proper regulation and monitoring so that people can be positively benefited by using digital technology.

Suggested Citation

  • Sanjoy Laha & Rabin Mazumder, 2025. "Spreading of Digital Banking in India and Its Impact on Credit Risk During the Era of Covid-19," Springer Books, in: Rabin Mazumder & Isita Lahiri & Dipak Saha & Nandan Sengupta & Kanad Chatterjee & David Earp (ed.), Resurgence and Sustainable Development of Asian Markets in the New Normal, pages 135-151, Springer.
    • Handle: RePEc:spr:sprchp:978-981-96-1785-2_8
    DOI: 10.1007/978-981-96-1785-2_8
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:sprchp:978-981-96-1785-2_8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.