The credit quality of companies has improved as upgrades by rating agencies have risen remarkably and downgrades have fallen in the last few months.

Even the National Automated Clearing House’s bounce rates data for banks have been improving, though there are concerns regarding the SME segment.

Asset quality of banks have improved steadily as gross non-performing loans of public sector banks declined to 6.7% in Q4FY22 from 8.4% in Q4FY21 and that of private sector banks to 3.2% from 4% during the same period.