Public Sector Banks sanctioned more than Rs 6.45 lakh crores in loans between March 1 and May 15, 2020. MSMEs, agriculture and retail received most of these loans, as banks distributed them to 54.9 lakh accounts, amidst the COVID-19 crisis.
Finance Minister Nirmala Sitharaman, in a tweet, revealed these numbers. The loan amounts see a sharp rise compared to the Rs 5.95 lakh crore sanctioned as of May 8.
Over Rs 1.03 lakh crores were approved as emergency credit lines and working capital enhancements between March 20- May15.
Many State-owned banks launched emergency credit lines to afford funds, not long after the announcement of the Lockdown. These lines funded MSMEs and corporate borrowers.
As per this scheme, banks would provide an additional line of credit of 10% of existing funds. This would be based within working capital limits. The credit lines could reach a maximum of Rs 200 crores.
The RBI, in March had allowed a three-month postponement on repayment of all term loans. This postponement was applicable only for term loans due between March 1-May 31, 2020.
The RBI will most likely extend the postponement by three more months, considering Lockdown 4.0.