Missed an EMI? Your Loan Could Turn into an SMA: Here's What That Means

• Missing an EMI can lead to your loan account being classified as a Special Mention Account (SMA) by banks.
• SMA is a warning sign indicating a deteriorating financial situation, preceding a Non-Performing Asset (NPA) classification.
• There are three stages of SMA: SMA-0 (1-30 days late), SMA-1 (31-60 days late), and SMA-2 (61-90 days late).
• An account becomes an NPA if payments are delayed by more than 90 days, severely impacting credit scores.
• To avoid SMA, ensure timely payments, set up automatic debits, and regularly check your credit report for accuracy.

Why It Matters: Missing EMIs can lead to SMA classification, negatively impacting credit scores and future loan applications.