State Bank India to extend moratorium on NBFC


Kolkata: The country’s largest lender SBI has decided to extend RBI-approved moratorium to the money-strapped NBFC sector to help them tide over the crisis, its MD Dinesh Kumar Khara said it on Thursday.

RBI has allowed banks to extend the moratorium on borrowers of all types of loans for three months – March, April and May.

“SBI has made a decision to extend the moratorium allowed by the RBI to the NBFC sector, which is facing a major cash flow problem,” Khara said.

The bank would extend the moratorium to non- Financial banking (NBFCs) on a case by case basis after assessing their cash budgets and investigating the need to extend it, I have told PTI.

“Just to make sure there is no gap in the cash flow and to help them flow over the readiness, SBI has made such a decision,” Khara said.

Earlier State Bank of India extended 10 percent enjoyed COVID response emergency loans to all kinds of borrowers to the extent of Rs 200 crore each, he said.

Reserve Banking chief Shaktikanta Das on Monday reviewed the liquidity position and ways to promote lending to the MSME sector during a meeting with representatives of NBFCs and mutual funds amid the closure triggered by the COVID-19 pandemic.

The operation of the NBFC has begun from Monday as the government eased the restrictions on the shutdown.

Some of the topics discussed during the meeting included the availability of liquidity from banks and other financial institutions and post-locklock strategies for the provision of credit, including working capital, to MSMEs, traders, and the bottom-line pyramid clients urban, rural and urban, the RBI said.

Implementation of the three-month moratorium on loan repayment announced by the RBI and strengthening of the grievance mechanisms were also discussed.

The governor acknowledged that NBFCs, including microfinance institutions (MFIs), play a critical role in the provision of last-mile credit and the importance of mutual funds in financial intermediation, the RBI said in the statement.

The RBI Governor on Saturday had met with public sector executives and private sector banks asking them to increase their lending to the MSME sector.





Source link