State of NPA finance across 15 Karnataka cities in the year 2025

Karnataka's heterogenous economy - of technology parks, manufacturing clusters and farming towns - is a living example of India's wider NPA picture. NPA finance in Karnataka, Be it sizeable debt syndication transactions in Bengaluru or recoveries from co-operative banks through Lok Adalat in Udupi, every city has its specialty.

Contribution of every city towards NPA resolution is showcased below, along with major legal frameworks (like the SARFAESI Act), private credit funds, one-time settlement (OTS) schemes and third-party financing of litigation - which are collectively propelling the state's march towards business revival and economic stability.

1. Bengaluru

Being the technology capital of India, it witnesses intricate debt syndication and loan refinance transactions with private credit funds. Asset reconstruction entities under the SARFAESI Act and the Lok Adalat 2025 programs complement each other to enable rapid disposal of SME NPA cases.

2. Mysore

Alternative funding (private credit) under the OTS scheme is being utilized by the tourism and auto component sectors in Mysore. Lok Adalats enable resolution, including third-party funding of litigation.

3. Mangaluru

The port-based commerce and petrochemical facilities here utilize private credit funds via debt syndication. The SARFAESI Act facilitates speedy recovery of collateral.

4. Hubli-Dharwad

Here in this twin-city industrial belt, cooperative networks facilitate small loans. OTS schemes and intervention by Lok Adalat accelerate revival.

5. Belagavi

The entry of private credit funds is rising in the agriculture and textile sectors here. Litigation funding is being used by local banks for recovery under the SARFAESI Act.

6. Kalaburagi (Gulbarga)

The agro-processing sector here is getting a boost from alternative funding and debt syndication. Lok Adalats are engaged in settlement of NPA cases of MSMEs.

7. Davanagere

Restructuring of the loan is being undertaken in the textile and grain sector here with OTS schemes and family office investments.

8. Ballari

The steel and mining sectors need specialized NPA finance. To resolve the problem, Private Credit and SARFAESI ACT can play a substantial role.

9. Bellary

The iron-ore sector here is reviving through litigation finance in third parties and senior and mezzanine debt structures.

10. Shimoga (Shivamogga)

This plantation economy city uses private credit via cooperative networks. Lok Adalats provide quicker recovery.

11. Tumkur

In developing engineering parks here, private credit funds and ARCs are coming together to formulate loan refinance schemes with reduced impact on promoter stake.

12. Hassan

This sugar and coffee clusters region is receiving finance from a mix of SEBI-regulated debt syndication and private sector OTS schemes. At the top of the ladder is the Lok Adaat 2025.

13. Udupi

Its economic system provides resolution via auctions under SARFAESI Act. Private credit funds working capital, and financing litigation is provided in complex matters.

14. Vijayapur (Bijapur)

Agriculture-oriented enterprises here are reviving via third-party funding. NBFCs' debt syndication and awareness camps are conducted at Lok Adalats.

15. Bidar

This small-scale industry and handloom town is resorting to alternative funding. Private credit funds are sponsoring NPA portfolios and Lok Adalats are yielding quicker resolution.

Conclusion

From debt syndication in Bengaluru to the cooperative strength of Udupi - 15 Karnataka cities are spearheading NPA resolution by embracing the SARFAESI Act, Lok Adalats 2025, OTS schemes and private credit models. With third-party litigation funding and digital platforms added, the state is making an investor-friendly restructuring landscape by 2025 and beyond.