An RTI reply from Bank of Baroda has sparked serious questions about financial transparency and accountability in India’s banking sector, revealing that the public sector lender technically wrote off a staggering ₹35,715 crore in loans belonging to large borrowers over a six-year period — while recovering less than a third of that amount.
What the RTI Revealed
According to the RTI response, Bank of Baroda (BoB) wrote off ₹35,715 crore in loans belonging to accounts with outstanding dues of ₹100 crore and above, spanning six financial years from FY2020-21 to FY2025-26. Out of this massive amount, the bank managed to recover only ₹9,946 crore — a recovery rate of less than 28%. In simple terms, for every ₹100 crore written off in large loan accounts, the bank recovered roughly ₹28 crore, while ₹72 crore effectively remained unrecovered from the books.
The RTI application was filed by Pune-based activist Vivek Velankar, who specifically sought details of large loan write-offs, including borrower names and settlement information. In response, the bank disclosed aggregate figures but refused to share borrower-wise details, citing exemptions under the RTI Act related to personal and third-party information.
A Separate ₹7,817 Crore in Haircuts
Beyond the technical write-offs, BoB also disclosed a separate figure of ₹7,817 crore, representing write-offs or “haircuts” accepted while settling large loan accounts — often through mechanisms like the National Company Law Tribunal (NCLT). This means that even when settlements were negotiated for these large accounts, the bank agreed to accept significantly reduced amounts compared to what was originally owed.
Names Withheld, Questions Raised
What has drawn the sharpest criticism isn’t just the scale of the write-offs, but the bank’s refusal to name the defaulters involved. Velankar didn’t mince words, calling the RTI response “deeply shocking,” and pointing out the irony that public sector banks — funded through public deposits and taxpayer-backed recapitalisation — continue to treat the identities of large defaulters as protected information, even as smaller borrowers often face far more visible recovery action, including public notices, for comparatively minor defaults.
Understanding “Technical Write-Offs”
It’s important to clarify what a technical write-off actually means. When a bank writes off a loan on its books, it does not mean the debt is forgiven or the borrower is no longer legally liable. Technically, recovery efforts can continue even after a write-off, and the borrower remains obligated to repay. However, critics argue that once an account disappears from the bank’s active balance sheet, the pressure, scrutiny, and urgency behind recovery efforts often fade significantly — a pattern reflected in the low 28% recovery rate for these large accounts.
The Bigger Banking Picture
This isn’t an isolated case. Public sector banks across India collectively wrote off over ₹1.27 lakh crore in loans at their peak in FY2022-23, though write-offs have since dropped by roughly 45% to ₹70,528 crore in FY2025-26, alongside an improved recovery rate of 46%, according to a government response in Parliament. While overall NPA ratios across Indian banks have improved significantly, cases like BoB’s ₹35,715 crore disclosure raise a pointed question: are large borrowers being held to the same standard of accountability as smaller ones?
The Bottom Line
With names undisclosed and recovery rates hovering below 30%, this RTI disclosure adds fresh fuel to an ongoing debate around banking transparency in India — one where the size of the loan may be shaping the level of scrutiny it receives.