Wait...

Online Export Import Data Search

Recent Searches: No Recent Searches
Complete Training Video : Click Here

FM Nirmala Sitharaman to meet PSU bank chiefs today; to review credit flow


Date: 11-05-2020
Subject: FM Nirmala Sitharaman to meet PSU bank chiefs today; to review credit flow
Finance Minister Nirmala Sitharaman will hold a review meeting with CEOs of public sector banks (PSBs) today to discuss various issues, including credit offtake, as part of efforts to prop up the economy hit by the COVID-19 crisis.

The meeting, to be held via video-conferencing, will also take stock of interest rate transmission to borrowers by banks and progress on moratorium on loan repayments, sources said.

The RBI had on March 27 slashed the benchmark interest rate by a massive 75 basis points and also announced a three-month moratorium to be given by banks to provide relief to borrowers whose income has been hit due to the lockdown.

Earlier this month, RBI Governor Shaktikanta Das held a meeting with heads of both public and private sector banks to take stock of the economic situation and review implementation of various measures announced by the central bank.

The deployment of excessive funds by banks under the reverse repo route may also come up for discussion on Monday, sources said.

Besides, progress under the targeted long-term repo operations (TLTRO) for the NBFC sector and micro finance institutions (MFIs), and sanctions under the COVID-19 emergency credit line will also be reviewed.

Under the emergency credit line, borrowers can avail a maximum of 10 per cent of the existing fund based working capital limits, subject to a cap of Rs 200 crore.

Public sector banks have sanctioned loans worth Rs 42,000 crore to the MSME sector and corporates since the start of the lockdown.

The finance minister had on Thursday said as many as 3.2 crore borrowers have taken advantage of the three-month moratorium scheme on repayment of loans announced by the Reserve Bank.

"PSBs complemented RBI on loan moratorium. Their effective communication & proactive actions ensured that over 3.2 cr. a/c availed 3-month moratorium. Quick query redressals allayed customer concerns. Ensuring responsible banking amid #lockdown," she had tweeted.

Sitharaman also said state-owned banks have sanctioned loans worth Rs 5.66 lakh crore to borrowers during March and April, and disbursement will start soon after the lockdown is lifted.

She said the banks sanctioned loans worth Rs 77,383 crore between March 1 and May 4 to provide sustained credit flow to non-banking finance companies (NBFCs) and housing finance companies.

Besides, under TLTROs, total financing of Rs 1.08 lakh crore was extended, "ensuring business stability and continuity going forward", she had said.

Meanwhile, MFI association Sa-Dhan, in a communication to the finance minister, said the sector expects to lend close to Rs 50,000 crore over the next six months, mostly by way of emergency or top-up loans to existing borrowers.

However, it expressed concern that there is a possibility of shortfall of collections of over 30-40 per cent by September and a potential default by MFIs to their lenders to the extent of 10 per cent.

There is likely to be a surge in demand from microfinance borrowers, given they urgently need credit to rebuild their lives and stabilise their incomes.

However, field collections will be affected given the negative impact of the COVID-19 crisis on clients' incomes as well as uncertainty in operations post lockdown in many districts, Sa-Dhan said.

Many of the mid and small MFIs will struggle to meet their operational expenses in full, with a potential shortfall of Rs 1,500-2,000 crore. The industry employs close to two lakh urban and rural youths, and sustaining their jobs is also an obligation for the sector, it added.

Source:- moneycontrol.com

Infodrive India Pvt Ltd

Delhi :
  F-19, Pocket F, Okhla Phase-I
      Okhla Industrial Area

      New Delhi- 110020
   011 - 40703001

Kolkata :
  5th Floor Stesalit Towers,
      E-2-3, EP & GP Block,

      Sector-V, Salt Lake City,
      Kolkata-700 091
   033 - 71177191

INFODRIVE INDIA Copyright © 1996-2020 InfodriveIndia. All Rights Reserved.
Please read our Terms of Use and Privacy Policy before you use.

Get Sample Now

Which service(s) are you interested in?
 Export Data
 Import Data
 Both
 Buyers
 Suppliers
 Both
OR
 Exim Help
+