Microfinance and Economic Well-being:

Microfinance institutions are especially responsive to the general economic well-being of a nation. An increase in their NPAs can be a good predictor of a declining GDP.
Growth in Lending and Prospective Risks
Monitoring lending growth in the financial sector is very important. If it grows more than 2.5 times the GDP, it may indicate possible problems such as fraud or a heavy rise in NPAs in subsequent years. This figure acts as a warning sign, making the long-term stability of the sector more conservative in its outlook.