Working capital loan sanctions doubled, banks contacted 95% eligible firms for credit: FM Sitharaman

By: |
May 10, 2020 12:16 PM

Nirmala Sitharaman’s office on Thursday had tweeted that PSBs sanctioned loans worth Rs 5.66 lakh crore for over 41.81 lakh accounts in MSME, retail, agriculture and corporate sectors during March-April 2020.

RBI, Nirmala Sitharaman, COVID-19, liquidity, incentivise banks, indian economy, financial stress, COVID-19, NABARD, latest news on RBIFinance Minister Nirmala Sitharaman also said banks have given the three-month loan moratorium facility to around 3 crore farmers for loans totalling Rs 4.22 lakh crore.

Finance Minister Nirmala Sitharaman on Saturday indicated that banks are ensuring businesses to have required liquidity to cope up with Covid-19 crisis. The FM’s office tweeted that banks have reached out to almost all eligible borrowers to provide emergency funds even as the amount sanctioned has been also enhanced. “PSBs (public sector banks) contacted more than 95% of borrowers eligible for emergency credit lines & working capital enhancements between March 20 – May 6. The amount sanctioned jumped to Rs 54,544 crore, more than double the amount 2 days ago. Number of cases covered more than tripled,” the tweet said.

Nirmala Sitharaman’s office on Thursday had tweeted that PSBs sanctioned loans worth Rs 5.66 lakh crore for over 41.81 lakh accounts in MSME, retail, agriculture and corporate sectors during March-April 2020. The disbursal will be made “soon after lockdown lifts. Economy is poised to recover!” the office tweeted. For non-banking financial companies (NBFC) and housing finance companies (HFC), PSBs have sanctioned Rs 77,383 crore in loans between March 1 and March 4 while additional funding of Rs 1.08 lakh crore have been sanctioned to NBFCs and HFCs “ensuring business stability & continuity going forward.”

Also read: ICICI Bank’s Q4 net below estimate; Rs 1,221 crore in March quarter

In a series of tweets on Saturday, Sitharaman also said banks have given the three-month loan moratorium facility to around 3 crore farmers for loans totalling Rs 4.22 lakh crore. “Since March 2020, 9.13 crore farmers have been paid Rs 18,253 crore under PM-KISAN during the #lockdown. About three crore farmers with agri loans totaling Rs 4,22,113 crore availed the benefit of the 3-month loan moratorium,” the minister said on her twitter handle. The government provides each farmer Rs 6,000 of income support annually in three instalments into their bank accounts under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme.

On March 27, the Reserve Bank of India had announced moratorium by banks on term loans that were scheduled for payments between March 1 and May 31.

The government has also provided support to states under the Rural Infrastructure Development Fund to boost rural employment. “Support of Rs 4224 cr was provided to states under RIDF during Mar, 2020 for promoting rural employment through infra projects. Working capital limit of Rs 6700 cr has been sanctioned for procurement of agriculture commodities to State Govt entities since Mar, 2020,” the tweet said.

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