In relief for MSMEs, No. 1 will be declared NPA until March 2020
NEW DELHI: Public sector banks, along with selected non-bank financial companies, will be deployed in 400 districts to grant loans to farmers, retail borrowers and micro , small and medium business (MSMEs), Minister of Finance Nirmala Sitharaman He said Thursday, when the government launched a strong offer to grant loans during the festival season.
The FM also said that banks have been told not to declare any stressed loan account of MSMEs to non-productive asset until March 2020.
On the proposed credit boost, he said, they can belong to the famous RAM category that is retail, agriculture (farmers), they can also belong to the MSME sectors. We are also adding to those who want home loans, those who want car loans to come too. ”
The range can be anything, self-help groups, Mudra, vehicle loans, home loans, MSMEs, any organization of agricultural producers, any of them can go there and that day sitting there can meet the loan requirements, said FM Sitharaman A press conference after a meeting with the heads of the banks.
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Government interested in increasing credit loss during the festival season
In detailing the government's latest push to ensure greater credit, Sitharaman said that the banks along with the NBFCs will sit under shamianas in a public place and meet the loan requirements of several groups.
This, he said, was being done to allow everyone to see that banks are coming out and providing credit and dispel the notion that programmed commercial banks have liquidity.
Sitharaman said that in the first phase, which will begin next Tuesday and end on September 29, 200 districts will be covered. Thereafter, the next 200 districts will be covered between October 10 and 15. Then, in two tranches, 400 districts of the country will have their neighborhood NBFCs or NBFCS operating in that area linked to the banks and getting the newest customers to come and get credit, Sitharaman said, adding that the banks are He said that for every old customer, five new customers should be brought.
That is the basic rule we have offered. That for each client that wants a loan, please give it to him. But for every new one, to whom I give it now, it will bring someone new, someone who has never taken a loan from a bank should be brought and given to the category they want, Sitharaman said. The FM said junior finance minister Anurag Thakur will oversee the loan program of PSU banks.
The government is eager to ensure that credit taking is accelerated during the festival season to help boost demand for goods ranging from consumer goods to housing and retail loans. The Center has presented a series of measures to counteract the impact of a slowdown in economic growth that slowed to a minimum of more than 6 years of 5% in the April-June quarter, which caused a call to take measures to boost growth.
With regard to the relief of MSMEs, Sitharaman said that an existing provision of the Reserve Bank entitles banks not to declare them NPA even after 90 days. Therefore, if there are MSMEs with stressed assets, the banks have sufficient powers granted by the Reserve Bank to not declare it NPA and work with them if possible to restructure their loan so that they can get out of the difficult situation, said the FM .